Purchases from suppliers = 70% of predicted sales for the next month

Accounts payable period = 30 days

Wages and other expenses = 20% of predicted sales

Capital expenditures (computer system purchase) in June = $500,000

Long-term debt interest expense = $50,000

Dividends = $30,000 per quarter

Minimum cash balance = $200,000

Short-term cost of borrowing = 13% APR, compounded monthly

Long-term cost of borrowing = 10% APR, compounded monthly

Income taxes from last years income will be paid monthly in this year

Interest expense on accumulated short-term expense must be paid in the following month

Customer payments: 50% in the month of sales, 30% pay in the month after sales, and 20% two months after sales

Bad debt = ~ 2% if customers have not made payment after 60 days

Table 4: Sales Forecasts for next 13 months

January	200,000
February	400,000
March	800,000
April	2,200,000
May	220,000
June	440,000
July	720,000
August	2,640,000
September	330,000
October	660,000
November	1,080,000
December	3,960,000
January	220,000

Mr. Jackson asks Ms. Truly to produce a report on the current state of the companys cash flows and short-term financing needs for a meeting next week. Ms. Truly wrote down the following tasks that must be completed prior to writing her report:

Construct the monthly cash collections table.

Construct the monthly cash disbursements table.

Calculate the monthly net cash inflow.

Construct the monthly cash budget.