Odane Cranston, the management accountant at BG Merchandising & More, is in the  process of planning the company’s cash needs for the last quarter of 2020. Extracts from  the sales and purchases budgets are as follows: Month 2020 Cash Sales Sales On  Account Purchases On Account August September October November December $85,000 $75,500 $69,870 $80,030 $63,010 $520,000 $640,000 $760,000 $680,000 $850,000 $420,000 $400,000 $520,000 $440,000 $540,000 i) 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  4/30, n90: 60% in the month of sale  25% in the first month following the sale 15% in the second month following the sale ii) Accounts payable are settled as follows, in accordance with the credit terms 2/30,  n60: 80% in the month in which the inventory is purchased  20% in the following month iii) In the month of November, the management of BG Merchandising expects to sell an  old motor vehicle that cost $700,000 to an employee at a gain of $45,000.  Accumulated depreciation on this motor vehicle at that time is expected to be  $585,000. The employee will be allowed to pay a deposit equal to 50% of the selling  price in November and the balance will be settled in two equal amounts in December  2020 & January 2021 iv) A money market instrument purchased by BG Merchandising & More with a face  value of $440,000 will mature on October 20, 2020. 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. Review Question _ November 2021 Page 2    v) Fixed operating expenses which accrue evenly throughout the year, are estimated to  be $2,160,000 per annum, and are settled monthly. Annual depreciation expense of non-current assets of $744,000 will be included in these costs. vi) The manager of BG Merchandising & More has negotiated with a tenant for rental of  office & storage space to him beginning October 2020. The rental is $780,000 per  annum. The first month’s rent along with one month’s safety deposit will be collected  from the tenant on October 1. Thereafter, the monthly rental in expected to be  received at the beginning of each month. vii) Computer equipment, which is estimated to cost $280,000, will be acquired in  November. The manager has agreed with the seller to make a cash deposit of 40% of  the amount upon signing of the agreement in November, with the balance to be  settled in four equal monthly instalments, starting in December 2020 viii) Other operating expenses are expected to be $174,000 per quarter and are settled  monthly. ix) Wages and salaries are expected to be $3,156,000 per annum and will be paid  monthly. x) At the recently concluded negotiations between management of BG Merchandising and the union representing the workers it was agreed that the business should make  retroactive payments in the amount of $1,180,000 to employees. The payment is  being settled in four equal tranches. The third payment becomes due and payable in  October of 2020. xi) The cash balance on September 30, 2020, is expected to be an overdraft of $148,000. Required: (a) Prepare a schedule of budgeted cash collections for sales on account for each of the  months October to December 2020 (b) Prepare a schedule of expected cash disbursements for purchases on account for the  quarter to December 31, 2020. (c) Prepare a cash budget, with a total column, for the quarter ending December 31,  2020, showing the receipts & payments for each month. (d) Companies in the industry in which BG Merchandising operates are required to  maintain a minimum cash balance of $120,000 each month. Suggest four (4) possible  internal measures that may be employed by management to address any expected  shortfall reflected in the budget prepared in part (c) above