Problem 10-38A Lorch Company prepares monthly cash budgets. Relevant data from operating budgets for 2013 are as follows: Sales Direct materials purchases Direct labour Manufacturing overhead Selling and administrative expenses January February $349,900 $404,900 119,700 108,900 111,510 74,850 79,140 84,970 59,740 74,900 All sales are on account. Lorch expects collections to be 50% in the month of sale, 40% in the first month following the sale, and 10% in the second month following the sale. It pays 30% of direct materials purchases in cash in the month of purchase and the balance due in the month following the purchase. It pays all other items above in the month incurred, except depreciation expenses. Other data are as follows: 1. Credit sales: November 2012, $203,400; December 2012, $281,000 2. Purchases of direct materials: December 2012, $88,510 3. Other receipts: January-collection of December 31, 2012, notes receivable $5,940; February-proceeds from sale of securities $5,570 4. Other disbursements: February payment of $21,900 for land The company expects its cash balance on January 1, 2013, to be $50,000. It wants to maintain a minimum cash balance of $40,000 Prepare schedules for (1) the expected collections from customers. Month November December January February January February (2) the expected payments for direct materials purchases Month December January February January February