Sales for October, November, and December Are Expected to Be

Essay

Sales for October, November, and December are expected to be $200,000, $180,000, and $220,000, respectively, for the Gurumai Company. All sales are on account (terms 2/15, net 30 days) and are collected 50 percent in the month of sale and 50 percent in the following month. One-half of all sales discounts are taken on the average. Materials are purchased one month before being needed, and all purchases and expenses are paid for as incurred. Activities for the quarter are expected to be: $\begin{array}{lrrr}&(\text { October }&\text {November}&\text { December }\\\text { Materials used } & \$ 40,000 & \$ 36,000 & \$ 44,000 \\\text { Sal aries } & 70,000 & 68,000 & 72,000 \\\text { Maintenance and repairs } & 18,000 & 18,000 & 18,000 \\\text { Depreci ation } & 36,000 & 36,000 & 36,000 \\\text { Utilities and other } & 14,000 & 14,000 & 14,000 \\\text { Dividends pad } & -0- & 10,000 & -0- \\\text { Payment on bonds } & 8,000 & 8,000 & 8,000\end{array}$ Required:
Using the given information, prepare a cash budget for November.