The Uthred Company, a merchandising firm, has planned the following sales for the next four months:

Total budgeted Sales for March= $50,000, April= $70,000, May= $90,000, June= $60,000

Sales are made 40% on account and 60% for cash. From experience, the company has learned that a month's sales on account are collected according to the following pattern:

Month of sale ......................................................... 70%

First month following month of sale ..................... 20%

Second month following month of sale ................. 8%

Uncollectible ......................................................... 2%

The company requires a minimum cash balance of $10,000 to start a month.

Required

a) Compute the budgeted cash receipts for May.

b) Assume the following budgeted data for May:

Purchases ..................................................... $52,000

Selling and administrative expenses ........... $12,000

Depreciation ................................................ $8,000

Equipment purchases ................................... $25,000

Cash balance, beginning of May ................. $8,000

Using this data, along with your answer to part (1) above, make a cash budget in good form for May (May Only). The company can borrow in any dollar amount, but will not pay any interest until the following month. (use word or hand written )