The following information for the second quarter of 2011 pertains to Huffington Company:

Month Sales Purchases

April $90,000 $48,000

May $120,000 $60,000

June $150,000 $84,000

Cash is collected from customers in the following manner:

Month of sale 30%

Month following the sale 70%

40% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month.

Labor costs are 20% of sales.Other operating costs are $45,000 per month (including $12,000 of depreciation).Both of these are paid in the month incurred.

The cash balance on June 1 is $6,000.A minimum cash balance of $4,500 is required at the end of the month.Money can be borrowed in multiples of $3,000.

No loans outstanding on June 1.

1) How much cash will be collected from customers in June?

A. $129,000

B. $114,000

C. $150,000

D. None of the above is correct.

2)How much cash will be paid to suppliers in June?

A) None of the above is correct.

B) $88,000

C) $69,600

D) $56,000