1. The Goose Grease Company had cash of $13,000 on hand on January 1, 2010. During 2010, the company expected the following cash collections from customers by quarter:

	First	Second	Third	Fourth
Cash collections	110,000	177,500	183,700	136,000

Direct materials purchases in tons were budgeted as follows:

First	Second	Third	Fourth
Direct materials purchases 65,000	75,000	55,000	50,000

The production budget showed the following unit production by quarter with an average labor rate of $ 40.00:

	First	Second	Third	Fourth
Units to be produced	1,500	2,000	1,700	1,500

Goose Grease planned to pay dividends of $10,000 per quarter during the year. During July, new equipment costing $60,000 was expected to be purchased. An additional

$16,000 was planned to installation costs during the fourth quarter. The company was required to maintain a minimum cash balance of $15,000. A line of credit was available for short-term borrowings. All borrowings will be made at the beginning of a quarter and repaid at the end of a quarter. Interest on the short-term borrowings will be paid at the rate of 0.5% per quarter on the amount repaid in any quarter when a loan repayment is made. All other interest expense will be accrued each quarter.

Required: Prepare a cash budget by quarter and for the year in total.