Cash budget: Basic Grenoble Enterprise has sales of $50,000 in March and $60,000 in April. Forecast sales for May, June, and July are $70,000, $80,000, and $100,000 respectively. The firm has a cash balance of $5,000 on May 1 and wishes to maintain a minimum cash balance of $5,000. Given the following data, prepare and interpret a cash budget for the months of May, June, and July.

1) The firm makes 20% of sales for cash, 60% are collected in the next month, and the remaining 20% are collected in the second month following sale.

2) The firm receives other income of $2,000 per month.

3) The firm actual or expected purchases, all made for cash are $50,000.

4) REnt is $3,000 per month

5) Wages and Salaries are 10% of the previous month's sales.

6) Cash dividends of $3,000 will be paid in June.

7) Payment of principal and interest of $4,000 is due in June.

8) A cash purchase of equipment costing $6,000 is scheduled in July.

9) Taxes of $6,000 are due in June.