The controller of Feinberg Company is gathering data to prepare the cash budget for July. He plans to develop the budget from the following info:

Of all sales, 40 percent are cash sales

Of credit sales, 45% are collected within the month of sale. Half of the credits sales are collected within the month receive a 2% cash discount (for accounts paid within 10 days). 30% of credit sales are collected in the following month; remaining credit sales are collected the month thereafter. There are virtually no bad debts.

Sals for the second two quarters of the year follow. (The first 3 months are actual sales, and the last three months are estimated sales.

Sales

April ...............................................$450,000

May ..................................................580,000

June ..................................................900,000

July ................................................1,140,000

August ..........................................1,200,000

September .....................................1,134,000

The company sells all that it produces each month. The cost of raw materials equals 26% of each sales dollar. The company requires a month ending inventory of raw materials equal to the coming month’s production requirements. Of raw materials purchases, 50% is paid for in the following month.

Wages total $105,000/month and are paid in the month incurred.

Budgeted monthly operating expenses total $376,000 of which $45,000 is depreciation and $6,000is expiration of prepaid insurance (the annual premium of $72,000 is paid on January 1).

Dividends of $130,000, declared on June 30 will be paid on July 15.

Old equipment will be sold for $25,200 on July 4

On July 13, new equipment will be purchased. For $173,000

The company maintains a minimum cash balance of $20,000

The cash balance on July 1 is $27,000

Required:

Prepare a cash budget for July. Give a supporting schedule that details the cash collections from sales.