Q Search in Document + Share - 11 Height: 4.85" ; Crop Width: 6.25" Format DO 59 - ACCT 2220 Case 2 Home Insert Design Layout References Mailings Review View Picture Format 2 2 9 X L 2 . j Remove Change Corrections Color Artistic Transparency 2 Quick 7 Position Wrap Bring Send Selection Align Background Picture Styles Janet Wooster owns a retail store that sells new and used sporting equipment. Janetti requested a cash budget for October. After examining the records of the company, you finde following: a. Cash balance on October 1 is $1,118. b. Actual sales for August and September are as folows: Effects Text Forward Backward Pane Panc Cash sales Credit sales Total sales August $ 6,000 58,000 $64,000 September $ 4.500 62.000 $66,500 Credit sales are collected over a three-month period: 40 percent in the month of sale. 36 per- sent in the next month, and 22 percent in the second month after the sale. The remaining sales are uncollectible. d Inventory purchases average 70 percent of a month's total sales. Of those purchases, 45 per- cent are paid for in the month of purchase. The remaining 55 percent are paid for in the fol- lowing month. Salaries and wages total $3,850 per month. f. Rent is $3,150 per month Taxes to be paid in October are $1.635. h. Janet usually withdraws $3,500 each month as her salary. i. Advertising is $1,500 per month j. Other operating expenses total $3,800 per month k. Internet and telephone fees are $320 per month. Janet tells you that she expects cash sales of $5,000 and credit sales of $63,000 for October She likes to have $3,000 on hand at the end of the month and is concerned about the potential October ending balance. Required: 1. Prepare a cash budget for October. Include supporting schedules for cash collections and cash payments. (Round all amounts to the nearest dollar.) 2. Did the business meet Janet's desired ending cash balance for October? Assuming that the owner has no hope of establishing a line of credit for the business, what recommendations would you give the owner for meeting the desired cash balance? Page 1 of 1 0 Words English (US) E E Focus - - - + 149%