The marketing department of Groovy Sue Backpacks has the following sales budget for the months of April through July:

	April	May	June	July
Budgeted Cash Sales	$ 35,000	$ 39,000	$ 33,000	$ 37,000
Budgeted Credit Sales	315,000	351,000	297,000	333,000
Budgeted Total Sales	$ 350,000	$ 390,000	$ 330,000	$ 370,000

• Management expects to collect 45% of credit sales in the month in which the credit sales are made and 55% in the following month. The balance of accounts receivable as of March 31^st, all of which is expected to be collected in April, is $148,500.

• The budgeted cost of goods sold is estimated to be 60% of total sales. Groovy Sue management wants ending inventory to be equal to 20% of the following month’s budgeted cost of goods sold. On March 31^st, the ending inventory was $42,000.

Required:

1. Using the template provided, calculate the expected cash collections for each month for April through June.

Groovy Sue Backpacks Schedule of Cash Collections
	April	May	June
Collections from:
Cash Sales
Credit Sales:
Accounts receivable, Mar 31st
April credit sales
May credit sales
June credit sales
Total collections

2. In the space provided below, prepare the merchandise inventory purchases budget for April through June.

Groovy Sue Backpacks Merchandise Purchases Budget
	April	May	June