Hello I need help with Question A & B only. I have seen multiple other answers o

Question

Hello I need help with Question A & B only. I have seen multiple other answers on this site but have not found a consistant answer. Please see attached photo. Thanks in advance.

LISIS C. maximum What is the monthly charge HGC should pay for the lockbox system? 1510 CASH BUDGETING Helen Bowers, owner of Helen's Fashion Designs, is planning - request line of a credit from her bank. She estimated the forecasts to the firm for parts of 2014 and 2015: has following sales for May 2014 $180,000 June 180,000 July August September 360,000 540,000 720,000 October 360,000 November 360,000 December 90,000 January 2015 Estimates regarding payments obtained from the credit department are as follows collected within the month of sale, 10%collected the month following the sale, 75% collected the second month 15labor following the sale, %. Payments for and raw materials are made the month after these services were provided. Here are the estimated costs of labor plus raw materials 180,000 May 2014 $90,000 June 90,000 July 126,000 August 882,000 September 306,000 October 234,000 November 162,000 December 90,000 Lease General and administrative salaries are approximately $27000 a month. payments under -are 000 a month. Depreciation charges are $36,000 a month. Iongterm leases $9,

Explanation / Answer

ANSWER A&B: PREPARATION OF CASH BUDGET AND MONTHLY ESTIMATES (at end of budget)

SUPPORTING CALCULATIONS:-

The cash budget indicates that Helen will have surplus funds available during July, August, November, and December. During September the company will need to borrow $155,100. The cash surplus that accrues during October will enable Helen to reduce the loan balance outstanding to $22,800 by the end of October.

SALES COLLECTIONS MAY JUNE JULY AUG SEPT OCT NOV DEC TOTAL May 18000 135000 27000 180000 June 18000 135000 27000 180000 July 36000 270000 54000 360000 Aug 54000 405000 81000 540000 Sept 72000 540000 108000 720000 Oct 36000 270000 54000 360000 Nov 36000 270000 306000 Dec 9000 9000 0 18000 153000 198000 351000 531000 657000 414000 333000 PAYMENTS FOR LABOR & RAW MATERIALS MAY JUN JULY AUG SEPT OCT NOV DEC May 90000 June 90000 July 126000 Aug 882000 Sept 306000 Oct 234000 Nov 162000 Dec

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