Use the following information to prepare the July cash budget for Acco Co. It should show expected cash receipts and cash payments for the month and the cash balance expected on July 31.

1. Beginning cash balance on July 1: $50,000.
2. Cash receipts from sales: 30% is collected in the month of sale, 50% in the next month, and 20% in the second month after sale (uncollectible accounts are negligible and can be ignored). Sales amounts are: May (actual), $1,720,000; June (actual), $1,200,000; and July (budgeted), $1,400,000.
3. Payments on merchandise purchases: 60% in the month of purchase and 40% in the month following purchase. Purchases amounts are: June (actual), $700,000; and July (budgeted), $750,000.
4. Budgeted cash payments for salaries in July: $275,000.
5. Budgeted depreciation expense for July: $36,000.
6. Other cash expenses budgeted for July: $200,000.
7. Accrued income taxes due in July: $80,000.
8. Bank loan interest paid in July: $6,600.

• Calculation
• Cash Budget

Calculate the budgeted cash receipts and cash payments.

Calculation of Cash Receipts from Sales
		------------------Collected in-------------------			July 31
	Total Sales	May	June	July	Accounts Rec.
Credit sales from:
May	$1,720,000
June	1,200,000
July	1,400,000
Totals	$4,320,000	$0	$0	$0	$0
Calculation of Cash Payments for Merchandise
		------------------Paid in-------------------			July 31
	Total Purchases	June	July		Accounts Pay.
Purchases from:
June	$700,000
July	750,000
Totals	$1,450,000	$0	$0		$0

• Cash Budget

Prepare the July cash budget for Acco Co.

ACCO CO.
Cash Budget
For the Month Ended July 31
Total cash available
Cash payments for:
Total cash payments
		$0