Problem 8-21 (Algo) Schedules of Expected Cash Collections and Disbursements (LO8-2, L08-4. LO8-8] You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following Information is available about the company's operations a. The cash balance on December 1 is $44.400 b. Actual sales for October and November and expected sales for December are as follows: Cash sales Saccount October $ 72,500 $425.000 Novedber December 5.86.600 5.9,000 5601,000 $ 617.000 Sales on account are collected over a three month period as follows: 20% collected in the month of sale: 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible, c. Purchases of inventory will total $358,000 for December. Thirty percent of a month's inventory purchases are paid during the month of purchase. The accounts payable remaining from November's inventory purchases total $207,000, all of which will be paid in December d. Selling and administrative expenses are budgeted at $459.000 for December of this amount. 564,500 is for depreciation e. A new web server for the Marketing Department costing $114.000 will be purchased for cash during December, and dividends totaling $9.500 will be paid during the month t. The company maintains a minimum cash balance of $20,000. An open line of credit is available from the company's bank to Increase its cash balance as needed. Required: 1. Calculate the expected cash collections for December 2. Calculate the expected cash disbursements for merchandise purchases for December 2. Prepare a cash budget for December Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month