Question 4 of4

Question 4 of 4 View Policies Show Attempt History Current Attempt in Progress Ivanhoe Company prepares monthly cash budgets. Relevant data from operating budgets for 2023 are as follows: 2.58 / 4 Sales Direct materials purchases Direct labour Manufacturing overhead Selling and administrative expenses January $347,000 119,000 84,000 59,000 75,000 February $396,000 111,000 113,000 75,000 81,000 All sales are on account. Ivanhoe 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. Other data are as follows: 1. 2. 3. 4. Credit sales: November 2022, $201,000; December 2022, $277,000 Purchases of direct materials: December 2022, $91,000 Other receipts: Januarycollection of December 31, 2022, notes receivable $5,000; Februaryproceeds from sale of securities $7,000 Other disbursements: Februarypayment of $20,000 for land The company expects its cash balance on January 1, 2023, to be $51,000. It wants to maintain a minimum cash balance of $40,000.