PROBLEM 4 Farley Clinic has budgeted revenues as follows: Cash revenues patient co-pays Credit revenues-billed to insurance Total revenues June $ 90,000 135,000 $225,000 July $255,000 145,000 $400,000 August $195,000 90,000 $285,000 Past experience indicates that 60% of the credit revenues will be collected in the month of service and the remaining 40% will be collected in the following month. Purchases of supplies are all on credit and 50% is paid in the month of purchase and 50% in the month following purchase. Budgeted supply purchases are:

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