Reference no: EM133107346

Question - Flounder, Inc provided the following information:

July August

Projected sales $240,000 $268.000

Projected merchandise purchases $154,000 $172 000

Flounder estimates that it will collect 40%% of its sales in the month of sale, 35%% in the month after the sale, and 2296 in the second month following the sale. Three percent of all sales are estimated to be bad debts.

Flounder pays for 20%% of merchandise purchases in the month purchased and 80% in the following month.

General operating expenses are budgeted to be $25,000 per month, including depreciation of $1,900.

Flounder pays operating expenses in the month incurred. Flounder makes loan payments of $5,000 per month of which $450 is interest and the remainder is principal.

Required - Calculate Flounder's budgeted cash disbursements for August.