The president of Univax Inc., has just approached the company's bank seeking short-term financing for the coming year, Year 2. Univax is a distributor of commercial vacuum cleaners. The bank has stated that the loan request must be accompanied by a detailed cash budget that shows the quarters in which financing will be needed, as well as the amounts that will be needed and the quarters in which repayments can be made To provide this information for the bank, the president has directed that the following data be gathered from which a cash budget can be prepared a. Budgeted sales and merchandise purchases for Year 2, as well as actual sales and purchases for the last quarter of Year 1, are as follows Merchandise Sales urchases Year 1 Fourth quarter actual First quarter estimated Third quarter estimated $200,000 $100,000 Year 2 $300,000 $180,000 Second quarter estimated $400,000 $230,000 S500,000 $290,000 Fourth quarter estimated $380,000 $160,000 er60% in the b. The company typically collects 38% of a quarter's sales before the quarter ends and following quarter. The remainder is uncollectible. This pattern of collections is now being experienced in the actual data for the Year 1 fourth quarter Some 10% of a quarters merchandise purchases are paid for within the quarter. The remainder is paid in the following quarter Seling and administrative expenses for Year 2 are budgeted at S80.000 per quarter plus 10% of sales Of the fixed amount, $10,000 each quarter is depreciation d e. The company will pay $11,000 in cash dividends each quarter f Land purchases will be made as follows during the year $81,000 in the second quarter and $47,000 in g The Cash account contained $21,000 at the end of Year 1. The company must maintain a minimum h The company has an agreement with a local bank that allows the company to borrow in increments of the third quarter cash balance of at least $19,000 $10,000 at the beginning of each quarter, up to a total loan balance of $100,000. The interest rate on these loans is 1% per month and for simplicity we wil assume that interest is not compounded The company would, as far as it is able, repay the loan plus accumulated interest at the end of the year i. At present, the company has no loans outstanding Required 1a. Prepare a schedule of expected cash collections on sales by quarter and in total for Year 2 (Leave no cells blank - be certain to enter "O" wherever required. Omit the "$" sign in your response.) e of Expected Cash Collections Year 2 Quarter First Second Year 1- Fourth quarter sales Year 2-First quarter sales Year 2 Second quarter sales Year 2-Third quarter sales Year 2- Fourth quarter sales 120000 120000 294000 392000 490000 144400 180000 152000 240000 190000 300000 144400 s234000 332000 430000444400 1440400 Total cash collections 1b.Prepare a schedule of expected cash disbursements for merchandise purchases, by quarter and in total for Year 2. (Leave no cells blank be certain to enter "O" wherever required. Omit the "$" sign in your response. Schedule of Expected Cash Disbursements-Merchandise Purcha Year 2 Quarter cond ourth Total 90000 S 18000 Year 1 Fourth quarter purchases Year 2-First quarter purchases Year 2- Second quarter purchases Year 2-Third quarter purchases Year 2-Fourth quarter purchases 90000 180000 230000 290000 16000 162000 23000 207000 29000 261000 16000 108000. SL 185000 SL 236000 $ . T7000 | SL-806000 Total cash disbursements 3. Prepare a cash budget by quarter and in total for Year 2. (Input all amounts as positive values except cash deficiency, repayments and interest which should be indicated by a minus sign. Leave no cells blank be certain to enter "O" wherever required. Omit the "$" sign in your response.) Cash Budget Year 2 Quarter First Fourth Year Cash balance, beginning 21000 $ 234000 36000 S 54000 S 444400 38000 S 430000 149000 1440400 Add collections from sales Total cash available Less disbursements 332000 255000] 3680001 468000] [ 498400] [ 1589400] Merchandise purchases Operating expenses Dividends Land 108000 100000 11000 277000 108000 11000 185000 110000 11000 81000 236000 120000 11000 47000 8006000 680000 44000 28000 2190003870004140003960001758000 Total disbursements Excess (deficiency) of receipts over disbursements 1800 640000 173400 36000 102400 Borrowings Repayments Interest 38000 38000 38000 3420 38000 3420 Total financing -38000 41420 3420 36000 38000 54000 60980 60980 Cash balance, ending The president of Univax Inc., has just approached the company's bank seeking short-term financing for the coming year, Year 2. Univax is a distributor of commercial vacuum cleaners. The bank has stated that the loan request must be accompanied by a detailed cash budget that shows the quarters in which financing will be needed, as well as the amounts that will be needed and the quarters in which repayments can be made To provide this information for the bank, the president has directed that the following data be gathered from which a cash budget can be prepared a. Budgeted sales and merchandise purchases for Year 2, as well as actual sales and purchases for the last quarter of Year 1, are as follows Merchandise Sales urchases Year 1 Fourth quarter actual First quarter estimated Third quarter estimated $200,000 $100,000 Year 2 $300,000 $180,000 Second quarter estimated $400,000 $230,000 S500,000 $290,000 Fourth quarter estimated $380,000 $160,000 er60% in the b. The company typically collects 38% of a quarter's sales before the quarter ends and following quarter. The remainder is uncollectible. This pattern of collections is now being experienced in the actual data for the Year 1 fourth quarter Some 10% of a quarters merchandise purchases are paid for within the quarter. The remainder is paid in the following quarter Seling and administrative expenses for Year 2 are budgeted at S80.000 per quarter plus 10% of sales Of the fixed amount, $10,000 each quarter is depreciation d e. The company will pay $11,000 in cash dividends each quarter f Land purchases will be made as follows during the year $81,000 in the second quarter and $47,000 in g The Cash account contained $21,000 at the end of Year 1. The company must maintain a minimum h The company has an agreement with a local bank that allows the company to borrow in increments of the third quarter cash balance of at least $19,000 $10,000 at the beginning of each quarter, up to a total loan balance of $100,000. The interest rate on these loans is 1% per month and for simplicity we wil assume that interest is not compounded The company would, as far as it is able, repay the loan plus accumulated interest at the end of the year i. At present, the company has no loans outstanding Required 1a. Prepare a schedule of expected cash collections on sales by quarter and in total for Year 2 (Leave no cells blank - be certain to enter "O" wherever required. Omit the "$" sign in your response.) e of Expected Cash Collections Year 2 Quarter First Second Year 1- Fourth quarter sales Year 2-First quarter sales Year 2 Second quarter sales Year 2-Third quarter sales Year 2- Fourth quarter sales 120000 120000 294000 392000 490000 144400 180000 152000 240000 190000 300000 144400 s234000 332000 430000444400 1440400 Total cash collections 1b.Prepare a schedule of expected cash disbursements for merchandise purchases, by quarter and in total for Year 2. (Leave no cells blank be certain to enter "O" wherever required. Omit the "$" sign in your response. Schedule of Expected Cash Disbursements-Merchandise Purcha Year 2 Quarter cond ourth Total 90000 S 18000 Year 1 Fourth quarter purchases Year 2-First quarter purchases Year 2- Second quarter purchases Year 2-Third quarter purchases Year 2-Fourth quarter purchases 90000 180000 230000 290000 16000 162000 23000 207000 29000 261000 16000 108000. SL 185000 SL 236000 $ . T7000 | SL-806000 Total cash disbursements 3. Prepare a cash budget by quarter and in total for Year 2. (Input all amounts as positive values except cash deficiency, repayments and interest which should be indicated by a minus sign. Leave no cells blank be certain to enter "O" wherever required. Omit the "$" sign in your response.) Cash Budget Year 2 Quarter First Fourth Year Cash balance, beginning 21000 $ 234000 36000 S 54000 S 444400 38000 S 430000 149000 1440400 Add collections from sales Total cash available Less disbursements 332000 255000] 3680001 468000] [ 498400] [ 1589400] Merchandise purchases Operating expenses Dividends Land 108000 100000 11000 277000 108000 11000 185000 110000 11000 81000 236000 120000 11000 47000 8006000 680000 44000 28000 2190003870004140003960001758000 Total disbursements Excess (deficiency) of receipts over disbursements 1800 640000 173400 36000 102400 Borrowings Repayments Interest 38000 38000 38000 3420 38000 3420 Total financing -38000 41420 3420 36000 38000 54000 60980 60980 Cash balance, ending