Electronique Instruments, a rapidly expanding electronic parts distributor, is formulating its plans for 2016. John Kedrowski, the firm's director of marketing, has completed his 2016 forecast and is confident that the company will meet or exceed sales estimates. The following sales figures show the growth that is expected and are the basis for planning in the other corporate departments:

Tae Hwan, assistant controller, is responsible for the cash flow projection, a critical element during a period of rapid expansion. She will use the following information in preparing her cash analysis:
1. Électronique has experienced an excellent record in accounts receivable collection and expects this trend to continue. The company collects 50% of billings in the month after the sale and 50% in the second month after the sale. Uncollectible accounts are nominal and can be ignored in the analysis.
2. The purchase of electronic parts is Électronique's largest expenditure; the cost of these items is equal to 60% of sales. Électronique receives 40% of the parts one month before it sells them and 60% during the month of sale.
3. Historically, Électronique has cleared 60% of the accounts payable one month after it receives its purchases, and the remaining 40% two months after.
4. Hourly wages, including fringe benefits, depend on the sales volume; they are equal to 20% of the current month's sales. The company pays these wages in the month incurred.
5. General and administrative expenses are projected to be $ 2,750,000 for 2016. The composition of these expenses is given below. The company incurs all of these expenses uniformly throughout the year, except for property taxes. It pays the property taxes in four equal installments in the last month of each quarter:

6. Électronique makes income tax payments in the first month of each quarter based on income for the prior quarter. The tax rate is 30%. The net income for the first quarter of 2016 is projected to be $750,000.
7. Électronique has a corporate policy of maintaining an end- of-month cash balance of $200,000. It invests or borrows cash monthly, as necessary, to maintain this balance.
8. Électronique uses a calendar-year reporting period.
Instructions
Prepare a schedule of Cash Receipts and Disbursements for Électronique Instruments, by month, for the second quarter of 2016. Be sure that all receipts, disbursements, borrowing, and investing amounts are presented on a monthly basis. Ignore the interest expense and income from borrowing and investing.

Month January February Forecast Sales 4,000,000 September 3,200,000 une 3,800,000 December 4,400,000 Salaries Promotion Property taxes Insurance Utilities Depreciation $ 490,000 670,000 250,000 370,000 350,000 620,000 $2,750,000 .rtu