Tara, manager of Lollipop Candies, has requested that you prepare a cash budget for June and July. Candies are sold in boxes. Each box is sold for $8. According to the firms policy, all sales are on credit. Analysis of records has shown that credit sales are collected over a two-month period, with 50 per cent being collected in the month of the sale and the remainder in the following month.

Actual sales of boxes of candy for May and projected sales of boxes of candy for June and July are as follows:

	May (actual)	June (projected)	July (projected)
Sales (boxes)	4 440	5 680	3 200

Selling and administrative expenses are budgeted to be $61 000 each month. The cash balance at the end of May is $25 000. Tara wants to maintain a minimum cash balance of $25 000 each month.

Required

a. Prepare a schedule showing customers' receipts for June and July. [4 Marks]

b. Prepare a cash budget for June and July. [4 Marks]

c. Analyse the cash position of the business and whether it meets the cash objective

of Tara. Advise on any financing requirements or investment opportunities.