Waterways Corporation is preparing its budget for the coming year, 2020. The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process. Sales Unit sales for November 2019 112,000 Unit sales for December 2019 103,000 Expected unit sales for January 2020 112,000 Expected unit sales for February 2020 Expected unit sales for March 2020 111,000 117,000 Expected unit sales for April 2020 Expected unit sales for May 2020 Unit selling price 125,000 138,000 $12 Waterways likes to keep 10% of the next month's unit sales in ending inventory. All sales are on account. 85% of the Accounts Receivable are collected in the month of sale, and 15% of the Accounts Receivable are collected in the month after sale. Accounts receivable on December 31, 2019, totaled $185,400. Direct Materials Direct materials cost 80 cents per pound. Two pounds of direct materials are required to produce each unit. Waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Raw Materials on December 31, 2019, totaled 11,190 pounds. Payment for materials is made within 15 days. 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2019, totaled $104,300. Direct Labor Labor requires 12 minutes per unit for completion and is paid at a rate of $6 per hour. Manufacturing Overhead Indirect materials 30 per labor hour Indirect labor 50 per labor hour Utilities 40 per labor hour Maintenance 20 per labor hour Salaries $41,000 per month Depreciation $16,600 per month Property taxes $2,500 per month Insurance $1,100 per month Maintenance $1,200 per month Selling and Administrative Variable selling and administrative cost per unit is $1.60. Advertising Insurance Salaries Depreciation Other fixed costs $14,000 a month $1,200 a month $74,000 a month $2,600 a month $3,000 a month Other Information The Cash balance on December 31, 2019, totaled $102,000, but management has decided it would like to maintain a cash balance of at least $800,000 beginning on January 31, 2020. Dividends are paid each month at the rate of $2.70 per share for 4,690 shares outstanding. The company has an open line of credit with Romney's Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 6% interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $450,000 equipment purchase is planned for February. For the first quarter of 2020, prepare a cash budget. (Round answers to O decimal places, e.g. 2,520.) WATERWAYS CORPORATION Cash Budget For the First Quarter of 2020 Beginning Cash Balance Add Receipts Collections From Customers Total Available Cash Less Disbursements Equipment Purchase Direct Labor Manufacturing Overhead Selling And Administrative Direct Materials Dividends Total Disbursements Excess (Deficiency) Of Available Cash Over Cash Disbursements Financing Add Borrowings Less Repayments Interest First Quarter January 102000 $ 1327800 February 800317 March 992450 Quarter 102000 1333800 1393200 4054800 1429800 2134117 2385650 4156800 450000 i 450000 i 134280 i 133920 i 141360 i 409560 i 93732 93732 93,648 272400 193808 i 179036 i 95384 282000 184108 12663 i 12663 i 12663 i 708483 1141667 715515 282400 828400 556952 i 137989 2565665 721317 992450 1670135 1591135 79000 (79000) (1185) i 79000 (79000) (1185) Ending Cash Balance $ 800317 $ 1670135 $ 1670135 $ 1670135