PrimeTime Sportswear is a custom imprinter that began operations six months ago. Sales have exceeded management's most optimistic projections. Sales are made on account and collected as follows: 50% in the month after the sale is made and 45% in the second month after sale. Merchandise purchases and operating expenses are paid as follows: In the month during which the merchandise is purchased or the cost is incurred In the subsequent month 78% 22% PrimeTime Sportswear's income statement budget for each of the next four months, newly revised to reflect the success of the firm, follows: September $ 41,400 October $ 53,900 November $ 68,200 December $ 59,300 Sales Cost of goods sold: Beginning inventory Purchases Cost of goods available for sale Less: Ending inventory Cost of goods sold Gross profit Operating expenses Operating income $ 5,950 37,500 $ 43, 450 (14,530) $ 28,920 $ 12,480 10,800 $ 1,680 $ 14,530 43,800 $ 58,330 (20,790) $ 37,540 $ 16,360 12,400 $ 3,960 $ 20,790 49,100 $ 69,890 (21,550). $ 48,340 $ 19,860 14,900 $ 4,960 $ 21,550 33,300 $ 54,850 (19,900) $ 34,950 $ 24,350 16,400 $ 7,950 Cash on hand August 31 is estimated to be $39,960. Collections of August 31 accounts receivable were estimated to be $17,540 in September and $14,540 in October. Payments of August 31 accounts payable and accrued expenses in September were estimated to be $24,460. Required: a-1. Prepare a cash budget for October and November. (Beginning cash should be indicated with a minus sign if it is a negative amount.) October November Beginning cash Cash receipts: August 31 accounts receivable September sales October sales November sales Total cash receipts Cash disbursements: September purchases October purchases November purchases September operating expenses October operating expenses November operating expenses Total cash disbursements Ending cash b-1. Assume now that PrimeTime Sportswear is a mature firm, and that the September-November data represent a seasonal peak in business. Prepare a cash budget for December, January, and February, assuming that the income statements for January and February are the same as December's. (Beginning cash should be indicated with a minus sign if it is a negative amount.) December January February Beginning cash Cash receipts: October sales November sales December sales January sales Total cash receipts Cash disbursements: November purchases December purchases January purchases February purchases November operating expenses December operating expenses January operating expenses February operating expenses Total cash disbursements Ending cash