The president of the retaller Prime Products has just approached the company's bank with a request for a $$83,000,90-$day loan. The purpose of the loan is to assist the company in acquiring inventorles. Because the company has had some difficulty in paying off its

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loans in the past, the loan officer has asked for a cash budget to help determine whether the loan should be made. The following data are avallable for the months April through June, during which the loan will be used:

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a$.$ On April $1,$ the start of the loan period, the cash balance will be $$18,800.$ Accounts recelvable on April $1$ will total $$165,200,$ of which $$141,600$ will be collected during April and $$18,880$ will be collected during May. The remainder will be uncollectible.

b$.$ Past experlence shows that $30\%$ of a month's sales are collected in the month of sale, $60\%$ in the month following sale, and $8\%$ in the second month following sale. The other $2\%$ is bad debts that are never collected. Budgeted sales and expenses for the threemonth perlod follow:

$\backslash$table$[[$Sales $($all on account$),$April,May,June$],[$Merchandise purchases,$$334,000,$$$510,000,$$$343,000$