Sales are budgeted at $300,000 for November, $310,000 for December, and $310,000 for January.

Collections are expected to be 80% in the month of sale, 17% in the month following the sale, and 3% uncollectible.

The cost of goods sold is 65% of sales.

The company would like to maintain ending merchandise inventories equal to 55% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase.

Other monthly expenses to be paid in cash are $20,700.

Monthly depreciation is $17,900.

Ignore taxes.

Balance Sheet

October 31

Assets

Cash $51,000

Accounts receivable, net of allowance for uncollectible accounts 99,000

Merchandise inventory 107,250

Property, plant and equipment, net of $627,000

accumulated depreciation 1,285,000

Total assets $1,542,250

Liabilities and Stockholders' Equity Accounts payable $291,250

Common stock 870,000

Retained earnings 381,000

Total liabilities and stockholders' equity $1,542,250

The difference between cash receipts and cash disbursements in December would be: $79,725 $114,325 $7,500 $36,613