PrimeTIme Sportswear is a custom Imprinter that began operatlons slx 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 pald as follows:

In the nonth during which the merchandise is purchased or the cost is incurred

In the subsequent month

PrimeTIme Sportswear's Income statement budget for each of the next four months, newly revised to reflect the success of the firm,

follows:

Cash on hand June $30$ is estimated to be $$40,090.$ Collections of June $30$ accounts recelvable were estimated to be $$17,620$ in July

and $$14,740$ in August. Payments of June $30$ accounts payable and accrued expenses in July were estlmated to be $$23,930.$

Required:

a$.1.$ Prepare a cash budget for August and September.

$2$ What are the prospects for this company if its sales growth continues at a simllar rate?

b$.1.$ Assume now that PrimeTIme Sportswear is a mature firm, and that the July to September data represent a seasonal peak in

business. Prepare a cash budget for October, November, and December, assuming that the income statements for November

and December are the same as October's.

$2$ Can the cash budget be used to support a request to a bank for a seasonal loan?

Complete this question by entering your answers in the tabs below.

Prepare a cash budget for August and September.

Note: Beginning cash should be indicated with a minus sign if it is a negative amount.