The PDC Company was described earlier in this chapter. Refer to the PDC Company’s projected monthly operating schedules in Table 6.2. PDC’s sales are projected to be $80,000 in September 2020.

A. Prepare PDC’s sales schedule, purchases schedule, and wages schedule for August 2020.

B. Prepare a cash budget for August 2020 for PDC and describe how the forecast affects the end-of-month cash balance.  

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Table 6.2 PDC Company Operating Schedules and Cash Budget Schedule 1: Sales Forecast Credit sales, 40% Cash sales, 60% Schedule 2: Cash Collections Cash sales this month 100% of last month's credit sales Total collections Schedule 3: Purchases Ending inventory Cost of goods sold Total needed Beginning inventory Purchases Schedule 4: Purchase Disbursements 50% of last month's purchases 50% of this month's purchases Disbursements for purchases Schedule 5: Wages and Commissions Wages, all fixed Commissions (15% of current sales] Total Schedule 6: Disbursements- Wages and Commissions 50% of last month's expenses 50% of this month's expenses Total MARCH 92,000 36,800 55,200 110,400 64,400 174,800 -97,520 (A) SALES SCHEDULE APRIL 115,000 46,000 69,000 69,000 MARCH APRIL 5,750 13,800 19,550 36,800 46,000 105,800 156,400 77,280 119,140 (B) PURCHASES SCHEDULE MARCH APRIL MAY 184,000 73,600 110,400 110,400 38,640 59,570 59,570 51,520 98,210 111,090 5,750 17,250 23,000 MAY 149,040 123,280 110,400 80,500 128,800 96,600 229,540 252,080 207,000 -10,400 -9,040 -23,280 103,040 83,720 9,775 11,500 21,275 (C) WAGES AND COMMISSIONS SCHEDULE MAY 5,750 JUNE 138,000 55,200 82,800 27,600 33,350 82,800 11,500 16,675 28,175 73,600 156,400 JUNE 51,520 41,860 93,380 JUNE 5,750 20,700 26,450 16,675 13,225 29,900 JULY 115,000 46,000 69,000 69,000 55,200 124,200 JULY 97,520 80,500 178,020 - 10,400 67,620 41,860 33,810 75,670 JULY 5,750 17,250 23,000 13,225 11,500 24,725 AUGUST 92,000 APRIL TO JULY 552,000 APRIL TO JULY 386,400 APRIL TO JULY 105,800