Rainbow Enterprises has presented the following estimates relating to 2018 activities.

Sales in the December quarter of 2017 were $690,000. All sales are on credit, of which 55 percent are collected in the quarter of sale and 45 per cent in the following quarter. Purchases are on credit, and entity policy is such that all purchases are paid for in the same quarter. The marketing and administration expenses incurred and paid are the same. Occupancy expenses incurred and paid are usually the same, except that the electricity bill (estimated to be $700) for December 2018 will not be paid until January 2019. A major IT hardware acquisition of $27300, to be paid for in cash, is expected in the December quarter. The bank balance at 31 December 2017 was $18,450.

Required
a. Prepare a schedule of receipts from accounts receivable showing cash collections for each quarter of 2018.
b. Prepare a cash budget (on a quarterly basis) for the 12 months ending 31 December 2018.
c. Assess the cash position of the entity for 2018.

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Sales revenue Purchases Cost of sales Marketing and administration expenses Occupancy expenses Depreciation expense 31 March $790 000 504 000 395 000 188 000 87 000 14 400 Quarter ending 30 June $890 000 429 000 445 000 188 000 87 000 14400 30 September $990 000 409 000 495 000 188 000 87 000 14400 31 December $1040000 439 000 520 000 188 000 87 000 14400