PrimeTime Sportswear is a custom imprinter that began operations six months ago. Sales have exceeded management's most optimistic projections. Sales are made on account and collected as follows: 50% in the month after the sale is made and 45% in the second month after sale. Merchandise purchases and operating expenses are paid as follows:

In the month during which the merchandise is purchased or the cost is incurred	72%
In the subsequent month	28%

PrimeTime Sportswear's income statement budget for each of the next four months, newly revised to reflect the success of the firm, follows:

Sales	$ 42,500	$ 53,600	$ 68,100	$ 58,600
Cost of goods sold:
Beginning inventory	$ 6,110	$ 14,710	$ 20,270	$ 22,400
Purchases	38,800	43,800	49,000	33,100
Cost of goods available for sale	$ 44,910	$ 58,510	$ 69,270	$ 55,500
Less: Ending inventory	(14,710)	(20,270)	(22,400)	(20,480)
Cost of goods sold	$ 30,200	$ 38,240	$ 46,870	$ 35,020
Gross profit	$ 12,300	$ 15,360	$ 21,230	$ 23,580
Operating expenses	10,600	13,200	14,500	16,500
Operating income	$ 1,700	$ 2,160	$ 6,730	$ 7,080

Cash on hand June 30 is estimated to be $39,730. Collections of June 30 accounts receivable were estimated to be $17,820 in July and $15,170 in August. Payments of June 30 accounts payable and accrued expenses in July were estimated to be $24,480.

1. Prepare a cash budget for August and September.

August	September
Beginning cash
Cash receipts:
June 30 accounts receivable
July sales
August sales
September sales
Total cash receipts
Cash disbursements:
July purchases
August purchases
September purchases
July operating expenses
August operating expenses
September operating expenses
Total cash disbursements
Ending cash

2. Assume now that PrimeTime Sportswear is a mature firm, and that the July to September data represent a seasonal peak in business. Prepare a cash budget for October, November, and December, assuming that the income statements for November and December are the same as October's.

October	November	December
Beginning cash
Cash receipts:
August sales
September sales
October sales
November sales
Total cash receipts
Cash disbursements:
September purchases
October purchases
November purchases
December purhcases
September operating expenses
October operating expenses
November operating expenses
December operating expenses
Total cash disbursements
Ending cash