You have been asked to prepare a July Cash budget for Amita Company. The following information is available about the company's operations:

a. The cash balance on July 1 is $30,000

b. Actual sales for May and June and expected sales for July are shown below. Sales on account are collected over a three-month period as follows:

30% collected in the month of sale, 60% collected in the month following sale, and 9% in the 2nd month following sale. The remaining 1% is uncollectable.

May

June

July

Cash Sales

$55,000.00

$80,000.00

$75,000.00

Sales on Account

$350,000.00

$620,000.00

$550,000.00

c. Purchase of inventory will total $250,000 for July. 40% of a month's inventory purchase are paid during the month of purchase.

The accounts payable remaining from June inventory purchases are paid during the month of purchase. The accounts payable remaining from June's inventory purchase total $141,000, all of which will be paid in July.

d. Selling and admin expenses are budgeted at $330,000 for July. Of this amount, $40,000 is for depreciaition.

e. A new web server for the Marketing Department costing $56,000 will be purchased for cash during July, and dividends totalling $10,000 will be paid during the month.

f. The company maintains a minimum cash balance of $35,000. An open line of credit is available from the company's bank to bolster the cash position as needed.

Required:

1.Prepare a schedule of expected cash collections for July

2. Prepare a schedule of expected cash disbursement during July for merchandise purchases

3. Prepare a cash budget for July. Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest wil lnot be paid until the following month.