Reference no: EM132573680

Sleepy Night Inc is a Bedding retailer.

The following relates to their projected sales for the next quarter

                               april                   may                   june

Cash Sales                30,000               35,000           65,000

Credit sales                  42,000              39,000          45,000

Purchases                       55,000            50,000           45,000

cost of sales                    35,000              40,000         50,000

rent                                15,000             15,000        15,000

wages and salaries              12,000            12,000      12,000

depriciation                       5,000                5,000          5,000

utilities                              2,500                 2,500        2,500

Sleepy Night's Credit sales were $30000 in February and $36000 in March. Based on historical experience, Sleepy Night usually receives 50% of their credit sales in the month of purchase, 30% in the month following the purchase and 20% in the second month after purchase. All purchases are on credit and paid for in the month of purchase. In June, the company plans to buy a new computer system for their office for $8000. They will also sell their existing computer for $1000 that month. At the beginning of the quarter, there was an unpaid utilities bill for $300 which will need to be paid in April. At the end of March, Sleepy Night had $20000 in the bank

Question a) Prepare the schedule of receipts for Sleepy Night

Question b) Prepare the Cash Budget for Sleepy Night for 3 months ending 30 june 2020