Cash Budgeting Dorothy Koehl recently leased space in the Southside Mall and opened a new business, Koehl's Doll Shop. Business has been good, but Koehl frequently runs out of cash. This has necessitated late payment on certain orders, which is beginning to cause a problem with suppliers. Koehl plans to borrow from the bank to have cash ready as needed, but first she needs a forecast of how much she should borrow. Accordingly, she has asked you to prepare a cash budget for the critical period around Christmas, when needs will be especially high. Sales are made on a cash basis only. Koehl's purchases must be paid for during the following month. Koehl pays herself a salary of $4,600 per month, and the rent is $1,800 per month. In addition, she must make a tax payment of $13,000 in December. The current cash on hand (on December 1) is $750, but Koehl has agreed to maintain an average bank balance of $7,000 - this is her target cash balance. (Disregard the amount in the cash register, which is insignificant because Koehl keeps only a small amount on hand in order to lessen the chances of robbery.) The estimated sales and purchases for December, January, and February are shown below. Purchases during November amounted to $150,000. Sales Purchases December $120,000 $35,000 January 46,000 35,000 February 66,000 35,000 Prepare a cash budget for December, January, and February. Do not round intermediate calculations. Round your answers to the nearest dollar. Negative values, if any, should be indicated by a minus sign. Collections and Purchases: December January February Sales (Collections) $ $ $ Purchases $ $ $ Payments for purchases $ $ $ Salaries $ $ $ Rent $ $ $ Taxes $ --- --- Total payments $ $ $ Cash at start of forecast $ --- --- Net cash flow $ $ $ Cumulative cash balance $ $ $ Target cash balance $ $ $ Surplus cash or loans needed $ $ $ Suppose that Koehl starts selling on a credit basis on December 1, giving customers 30 days