Section 5: Budgets 10 marks

The manager ofIngrid Ltdis preparing their budget for the upcoming fiscal quarter, commencing 1 January. The following information is available:

• The following balances are expected for the end of this month (31 December): cash $20,000; accounts receivable $140,000, accounts payable $50,000 and unpaid expenses $16,000. The manager expects 95% of the amount outstanding from customers at the end of this month to be collected in January and the remainder uncollectable.
• Projected balances for the next quarter are as follows:

	January	February	March
Sales revenue	152,000	154,000	160,000
Purchases	80,000	82,000	84,000
Salaries	20,000	20,000	20,000
Depreciation	5,000	5,000	5,000
Other expenses	32,000	33,000	34,000

• 80% of monthly sales are on credit. Receipts from credit customers are normally 70% in the month of sale, 26% in the month following the sale, and the remainder is considered uncollectable.
• 40% of goods purchased are paid for in the month of purchase and the remaining is paid in the following month.
• Salaries are paid before the end of each month. 50% of other monthly expenses are paid for in the month incurred and the remainder paid in the following month.
• Ingrid Ltdhas placed an order for new furniture that will cost $20,000. The scheduled payment date is in April.

Required:

Prepare the schedule of cash receipts for January to March. (10 marks)