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: PART B: Assume now that PrimeTime Sportswear is a mature firm, and that the SeptemberNovember 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.)

In the month during which the merchandise is purchased or the cost is incurred 77% In the subsequent month 23% PrimeTime Sportswears income statement budget for each of the next four months, newly revised to reflect the success of the firm, follows: September October November December 42,600 54,000 68,100 58,800 Sales Cost of goods sold: 5,550 14,050 20,170 22,400 Beginning inventory 49,000 38,600 44,500 32,800 Purchases 44,150 58,550 69, 170 55,200 Cost of goods available for sale 14.050 L (20.170) (22,400) (20,230). Less: Ending inventory 30,100 38,380 46,770 34,970 Cost of goods sold Gross profit 12,500 15,620 21,330 23,830 10,000 2,600 14,800 15,900 operating expenses 2,500 3,020 6,530 7,930 operating income Cash on hand August 31 is estimated to be $39,520. Collections of August 31 accounts receivable were estimated to be S19,750 in September and $14,610 in October. Payments of August 31 accounts payable and accrued expenses in September were estimated to be $24,180. 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.)