5 Assigned Problem 1 6 James Buchanan Orthotics and Prosthetics is planning to request a line of credit from its bank. 7 The company has produced sales estimates, and these appear in the worksheet below. Collection 8 estimates are as follows: 10 percent within the month of sale, 75 percent in the month following 9 the sale, and 15 percent in the second month following the sale. Labor and supplies estimates also 10 appear in the worksheet below. Payments for labor and supplies are typically made during the 11 month following the one in which these costs have been incurred. General and administrative 12 salaries will amount to approximately $27,000 a month; lease payments under long-term lease 13 contracts will be $9,000 a month; depreciation charges will be $36,000 a month; miscellaneous 14 expenses will be $2,700 a month; income tax payments of $63,000 will be due in both September 15 and December; and a progress payment of $180,000 on a new building must be paid in October. 16 Cash on hand on July 1 will amount to $132,000, and a minimum cash balance of $90,000 will be 17 maintained throughout the cash budget period. What loan will be the company require in 18 October? 19 Odabert penyi ANSWER May June Aurust September October November December January $180,000 S180,000 $100,000 5540,000 5720,000 $360,000 $360,000 390,000 SIRO,000 50 50 590,000 50 590,000 $126.000 SR1,000 $106.000 $234,000 5163,000 $90,000 Collection worksheet: 1. Wed charges 2 Collections within 30 days 6 30-60 days 7 60-90 days 283 Total collections 29 30 Sapplia worksheet 314 Amunt of labor and supplies 32 Payments made for labor and supplies 33 34 Net cash pain ) 35 6. Total sections (line 3 35 7. Total purchases (lies) STA General and ministrative salaries 38 S. Le pays 39 10 Mindanao 40 11 Tas 41 12 Pre payment 423 Telky 43 14 Natash girl 44 45 Burruleguro may 46 15 Cash glasing with a berria 47 16 Cash with brewing line 14+15) 48 19 Target the balance) 49 1 Comalathe uple aalaam) 56 61 52 53 54 55 50 -527.000 -39,000 -$2.700 -527,000 -39,000 -$1,700 -327,000 -59,000 -51.700 -527,000 -59.000 -52.700 $27,000 -39.000 -$2,700 563.000 -527,000 -39.000 -53.700 327,000 59,000 $2.700 -527,000 -59.000 31,700 -527,000 -$9.000 1.700 -S180,000 133.000 $90.00 320,000 59.000 1