Prince Charles Island Company has expected sales of $$6,000$ in September, $$10,000$ in October, $$16,000$ in November, and $$12,000$ in December. Cash sales are $20$ percent and credit sales are $80$ percent of total sales. Historically, $40$ percent of receivables are collected in the month after the sale, and the remaining $60$ percent collected two months after.

Assume that the company$$s cash payments for November are $$13,000,$ and December $$6,000.$ The beginning cash balance in November is $$5,000,$ which is the desired minimum balance.

a$.$ Prepare a cash receipts schedule for November and December.

Prince Charles Island Company

Cash Receipts Schedule

September October November December

Sales $

$6000$

$

$10000$

$

$16000$

$

$12000$

Credit sales

$4800$

$8000$

$12800$

$9600$

Cash sales

$1200$

$2000$

$3200$

$2400$

Collections in the month after credit sales

$3200$

$5120$

Collections two months after credit sales

$2880$

$4800$

Total cash receipts $

$9280$

$

$12320$

b$.$ Prepare a cash budget with borrowing needed or repayments for November and December. $($Do not leave any empty spaces; input a $0$ wherever it is required. Amount to be deducted should be indicated with minus sign.$)$

Prince Charles Island Company

Cash Budget

November December

Cash receipts $

$832$

$

$11040$

Cash payments

Net cash flow

Beginning cash balance

Cumulative cash balance

Monthly loan or $($repayment$)$

Cumulative loan balance

Ending cash balance $

$