Pauls Pool Service provides pool cleaning chemical applicati

Paul\'s Pool Service provides pool cleaning, chemical application, and pool repairs for residential custor Clients are billed weekly for services provided and usually pay 60 percent of their fees in the montl service is provided. In the month following service, Paul collects 35 percent of service fees. The percent is collected in the second month following service. Paul purchases his supplies on credit, and 50 percent in the month of purchase and the remaining 50 percent in the month following purchase. C supplies Paul purchases, 70 percent is used in the month of purchase, and the remainder is used ir month following purchase. The following information is available for the months of June, July, and August, which are Paul\'s busi months: June 1 cash balance $15, 700. June 1 supplies on hand $4, 300. June 1 accounts receivable $8, 900. June 1 accounts payable $4, 200. Estimated sales for June, July, and August are $26, 700, $40, 100, and $42, 900, respectively. Sales during May were $25, 100, and sales during April were $17, 900. Estimated purchases for June, July, and August are $9, 800, $18, 800, and $13, 500, respectively. Purchases in May were $5, 400. Required: 1. Compute budgeted cash receipts and budgeted cash payments for each month.

Solution

1. Budgeted cash receipt and budgeted cash payment of each month are as follows.

W.N.1 Sales collection for each month

W.N.2   purchase payment for each month

2.

	June $	July$	August$
opening cash balance (A)	15,700	50,700	92,360
BUDGETED CASH RECEIPTS	-	-	-
Sales collection	52,400	74,760	84,010
Total(B)	68,100	125,460	176,370
BUDGETED CASH PAYMENTS
Purchase payment	17,400	33,100	29,650
Total©	17,400	33,100	29,650
Closing Cash balance(B-C)	50,700	92,360	146,720