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You are a relatively recent hire to Hartz & Company, a local manufacturer of plumbing supply products. You have been asked to prepare a condensed

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You are a relatively recent hire to Hartz \& Company, a local manufacturer of plumbing supply products. You have been asked to prepare a condensed statement of cash flows for the months of November and December of the current year for presentation to the company's management. Assume the cash balance at November 1 will be $76,000. It is the company's policy to maintain a minimum cash balance of $55,000 at the end of each month. Cash receipts (from cash sales and collection of accounts receivable) are projected to be $524,000 for November and $455,000 for December. Cash disbursements (sales commissions, advertising, delivery expense, wages, utilities, etc.) prior to financing activity are scheduled to be $446,450 in November and $556,000 in December. Short-term borrowing, when needed, is done at the beginning of the month in increments of $1,000. The annual interest rate on any such loans is estimated to be 12%. Interest on any outstanding short-term loans is paid in cash at the end of the month. Repayments of principal (f any) are assumed to occur at the end of the month. As of November 1, the company has a $55,000 long-term loan from the local bank. This loan, including interest (at 12% per year) for the month of November, is payable at the end of November. Required: Use the preceding information to prepare the cash budget for November and December. (Hint: The December 31 cash balance should be $55,410.) (Enter financing and interest payments as negative amounts.) Required: Use the preceding information to prepare the cash budget for November and December. (Hint: The December 31 cash balance should be $55,410.) (Enter financing and interest payments as negative amounts.)

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