In the fourth quarter of 2011, Eurot Cycling, a bike shop, had the following net income: Sales

In the fourth quarter of 2011, Eurofit Cycling, a bike shop, had the following net income:

Sales .................$350,000

Less cost of sales ............ 140,000

Gross margin .............. 210,000

Selling and administration ......... 65,000

Income before taxes ............ 145,000

Income taxes .............. 50,750

Net income .............. $ 94,250

Purchases in the fourth quarter amounted to $180,000.

Estimated data for Eurofit Cycling for 2012 are as follows:

Taxes are 35 percent of pretax income. Fifty percent of sales are collected in the quarter of sale and 50 percent are collected in the next quarter. Eighty percent of purchases are paid in the quarter of purchase and 20 percent are paid in the next quarter. Selling and administrative expenses are paid in the quarter incurred except for $7,000 of depreciation included in selling and administrative expense. A capital expenditure for $20,000 is planned for the fourth quarter of 2012.

Required
Prepare a cash budget for each quarter of2012.

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Sales Cost of sales Purchases Selling and administration Quarter1 Quarter 2 Quarter 3 Quarter 4 $575,000 230,000 232,000 73,000 $425,000 170,000 175,000 67,000 190,000 200,000 69,000 $550,000 220,000 225,000 71,000