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Sheffield, inc, has budgeted sales revenues as follows: Past experience indicates that 60% of the credit sales will be collected in the month of sle

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Sheffield, inc, has budgeted sales revenues as follows: Past experience indicates that 60% of the credit sales will be collected in the month of sle and the remaining 40% will be collected in the following month. Purchases of inventory are all on account with 50% is paid in the month of purchase and 50% paid in the month following purchase. Budgeted inventory purchases are as follows: June $302,000 July 220,000 August 109,000 Other cash disbursements budgeted: (a) selling and administrative expenses of $51,000 each month, (b) dividends of $110,000 will be paid in July, and (c) purchase of equipment in August for $40,000 cash. The company's policy is to maintain a minimum cash balance of $50,000 at the end of each month. The company borrows money from the bank at 6% interest if necessary to maintain the minimum cash balance. Borrowed money is repaid in months when there is an excess cash balance. The beginning cash balance on July 1 was $50,000. Assume that borrowed money in this case is for one month. Sheffield, inc, has budgeted sales revenues as follows: Past experience indicates that 60% of the credit sales will be collected in the month of sle and the remaining 40% will be collected in the following month. Purchases of inventory are all on account with 50% is paid in the month of purchase and 50% paid in the month following purchase. Budgeted inventory purchases are as follows: June $302,000 July 220,000 August 109,000 Other cash disbursements budgeted: (a) selling and administrative expenses of $51,000 each month, (b) dividends of $110,000 will be paid in July, and (c) purchase of equipment in August for $40,000 cash. The company's policy is to maintain a minimum cash balance of $50,000 at the end of each month. The company borrows money from the bank at 6% interest if necessary to maintain the minimum cash balance. Borrowed money is repaid in months when there is an excess cash balance. The beginning cash balance on July 1 was $50,000. Assume that borrowed money in this case is for one month

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