Vaughn Company prepares monthly cash budgets. Relevant data from operating budgets for 2022 are as follows. January February Sales $446,400 $496,000 Direct materials purchases 148,800 155,000 Direct labor 111,600 124,000 86,800 93,000 Manufacturing overhead Selling and administrative expenses 97,960 105,400 All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (60%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred except for selling and administrative expenses that include $1,240 of depreciation per month. Other data: 1. Credit sales: November 2021, $310,000: December 2021, $396,800. 2. Purchases of direct materials: December 2021, $124,000. Other receipts: January-Collection of December 31, 2021, notes receivable $18,600; 3. February-Proceeds from sale of securities $7,440. 4. Other disbursements: February-Payment of $7,440 cash dividend. The company's cash balance on January 1, 2022, is expected to be $74,400. The company wants to maintain a minimum cash balance of $62,000. (a) Your answer is correct. Prepare schedules for (1) expected collections from customers and (2) expected payments for direct materials purchases for January and February VAUGHN COMPANY Schedule of Expected Collections from Customers For the Two Months Ending February 28, 2022 January February November 62000 December 119040 79360 January 223200 133920 February 248000 I Total collections $ 404240 461280 VAUGHNCOMPANY Schedule of Expected Payments for Direct Materials For the Two Months Ending February 28, 2022 January February December $ 49600 January 89280 59520 February 93000 Total payments $ 138880 152520 e Textbook and Media Attempts: 3 of 5 used Your answer is partially correct. Prepare a cash budget for January and February in columnar form. VAUGHN COMPANY Cash Budget January Beginning Cash Balance $ 74400 Add V: Receipts Collections from Customers 404240 Notes Receivable 18600 Sale of Securities i Total Receipts 422840 Total Available Cash 497240 Less V: Disbursements Direct Materials 138880 i Direct Labor 111600 i Manufacturing Overhead 86800 i Selling and Administrative Expenses 96720 i Cash Dividend i Total Disbursements 434000 i Excess (Deficiency) of Available Cash Over Cash Disbursements 63240 Borrowings Ending Cash Balance $ 63240 Your answer is partially correct. Prepare a cash budget for January and February in columnar form. VAUGHN COMPANY Cash Budget January February ce $ 74400 63240 pts tomers 404240 461280 18600 i i 7440 422840 468720 531960 Acceptable correct answers also include: irsements - 138,880 138880 i 152520 i 111600 i 124000 i head 86800 i 93000 i i rative Expenses 96720 i i 104160 i i 7440 i i 434000 i 481120 i Available Cash Over Cash Disbursements V 63240 50840 TO $ 63240 $ 62000 Toutbool and Media