Yusef Lateef Corporation produces Saxophones. The company wants to prepare a cash budget for the upcoming month of December. Available information is as follows:

December

Budgeted Revenues and Costs

Sales Revenues $3,400,000

Direct Labor Costs 700,000

Administrative Expense 1,200,000

Selling & Marketing Costs 300,000

Other Non-Manufacturing Costs 200,000

The cash balance as of November 30 is $80,000. The firm generally collects 30% of its receivables in the month of sale, 60% in the month after, and the remaining 10% in the second month after the month of sale. Sales in October totaled $2,200,000, all credit sales. In November they totaled $2,700,000, all credit sales. $3,000,000 of the December sales are expected to be credit sales. The remaining are expected to be cash sales

The firm pays its suppliers 20% in the month of purchase, and 80% in the following month (two-month schedule of payments to suppliers). November purchases of supplies were $1,700,000. Purchases from suppliers in December are expected to be $1,700,000. 30% of the Administrative Expense is Depreciation Expense (of office buildings and so on). The firm expects equipment purchases of $190,000 and dividend payments to shareholders of $100,000 in December.

The firms policy is to maintain a minimum cash balance of $70,000 at all times, and can borrow from its bank to achieve that balance if needed. Required: Prepare Yusef Lateef Corporations cash budget for the month of December. If you want to follow the approach we used in class, you would 1) prepare a mini cashcollections-from-customers schedule 2) prepare a mini cash-payments-to-suppliers schedule and finally 3) prepare the December cash budget itself, including planned borrowed if there is a cash shortfall (deficiency).

Record in your solution BOX these numbers: The Cash Deficiency $ amount The Planned Borrowing $ amount OR just the bottom three numbers of your Cash Budget