Crazy Jay's (CJ's) is a boat and jet ski parts store operating in South Beach, Miami. You are the junior management accountant of the business and have been asked to prepare the cash budget for the business for the quarter ending June 30, 2021. Your data collection has yielded the following: (i) Extracts from the sales and purchases budgets are as follows: Feb 2021–Jun 2021                                  Cash Sales  Sales On Account  Purchases February                   $151,100        $480,000            $390,000 March                       $145,500        $600,000            $360,000 April                          $159,025        $700,000            $505,000 May                          $169,350        $650,000             $400,000 June                          $176,200        $800,000            $518,000 (ii) An analysis of the records shows that trade receivables (accounts receivable) are settled according to the following credit pattern, in accordance with the credit terms 2/30, n90: 45% in the month of sale 30% in the first month following the sale 25% in the second month following the sale (iii) Expected purchases include cash purchases of $25,000 in April and $18,000 in June. All other purchases are on account. Accounts payable are settled as follows, in accordance with the credit terms 4/30, n60: 75% in the month in which the inventory is purchased 25% in the following month (iv) The management of CJ's is in the process of upgrading its fleet of boats. During June the company expects to sell an old cabin cruiser boat that cost $500,000 at a gain of $45,000. Accumulated depreciation on this boat at that time is expected to be $340,000. The employee will be allowed to pay a deposit equal to 60% of the selling price in June; the balance will be settled in two equal amounts in July & August of 2021. (v) An air conditioning unit, which is estimated to cost $300,000, will be purchased in May. The manager has made arrangements with the suppliers to make a cash deposit of 40% upon signing of the agreement in May. The balance will be settled in four (4) equal monthly instalments beginning June 2021. (vi) A long-term bond purchased by Cj's 4 years ago, with a face value of $500,000 will mature on April 20, 2021. In order to meet the financial obligations of the business, management has decided to liquidate the investment upon maturity. On that date quarterly interest computed at a rate of 5½% per annum is also expected to be collected. (vii) Fixed operating expenses which accrue evenly throughout the year, are estimate d to be $2,016,000 per annum, [including depreciation on non-current assets of $42,000 per month] and are settled monthly. (viii) Other operating expenses are expected to be $177,000 per quarter and are settled monthly. 3 (ix) The management of Cj's has negotiated with a tenant to rent office space to her beginning May 1st. The rental is $540,000 per annum. The first month’s rent along with one month’s safety deposit is expected to be collected on May 1st. Thereafter, monthly rental income becomes due at the beginning of each month. (x) Wages and salaries are expected to be $2,976,000 per annum and will be paid monthly. (xi) As part of its investing activities, the management of CJ's has just concluded an expansion project relating to the business’s storage facilities. The project required capital outlay of $1,800,000 and was funded by a loan from a family member, who  is a partner in the business. $340,000 of the principal along with interest of $35,000 will become due and payable in April 2021. (xii) The cash balance on June 30, 2021 is expected to be an overdraft of $92,000 Required: (a) The business requires the preparation of the following: ▪ A schedule of budgeted cash collections for trade receivables (sales on account) for each of the months April to June.  ▪ A schedule of expected cash disbursements for accounts payable (purchases on account) for each of the months April to June.  ▪ A cash budget, with a total column, for the quarter ending June 30, 2021, showing the expected cash receipts and payments for each month and the ending cash balance for each of the three months, given that no financing activities took place.  (b) Another team member who is preparing the Budgeted Balance Sheet for the business for the same quarter and has asked you to furnish him with the figures for the expected trade receivables and payables to be included in the statement. Is that a reasonable request? If yes, what should these amounts be?  (c) Upon receipt of the budget the team manager has now informed you that the management of CJ's has indicated a desire to maintain a minimum cash balance of $155,000 each month. Based on the budget prepared, will the business be achieving this desired target? Given that management does not wish to borrow any funds from outside sources, suggest three (3) internal strategies that the business may employ in order to improve the organization’s monthly cash flow. Each strategy must be fully explained.