You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the companys operations: a. The cash balance on December 1 is $56,600. b. Actual sales for October and November and expected sales for December are as follows: October November December Cash sales $ 71,200 $ 73,400 $ 86,200 Sales on account 440,000 576,000 639,000 Sales on account are collected over a three-month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible. c. Purchases of inventory will total $315,000 for December. Thirty percent of a months inventory purchases are paid during the month of purchase. The accounts payable remaining from Novembers inventory purchases total $181,500, all of which will be paid in December. d. Selling and administrative expenses are budgeted at $522,000 for December. Of this amount, $74,100 is for depreciation. e. A new web server for the Marketing Department costing $103,500 will be purchased for cash during December, and dividends totaling $10,000 will be paid during the month. f. The company maintains a minimum cash balance of $20,000. An open line of credit is available from the companys bank to bolster the cash position as needed. Required: 1. Prepare a schedule of expected cash collections for December. Ashton Company Schedule of Expected Cash Collections December cash sales : Collections on account: October sales: November sales: December sales: Total cash collections: Prepare a schedule of expected cash disbursements for merchandise purchases for December Ashton Company Schedule of Expected Cash Disbursements Payments to suppliers: November purchases: Decemberpurchases: Total cash payments: Ashton Company Cash Budget For the Month of December Beginning cash balance: Add collections from customers: Total cash available: Less cash disbursements: Payments to suppliers for inventory: Selling and administrative expenses: New web server: Dividends paid: Total cash disbursements: Excess (deficiency) of cash available over disbursements Financing: Borrowings Repayments Interest Total financing Ending cash balance