Sales, purchase, and other budgets January For the Month Ended April 30, 2015 Pu

Question

Sales, purchase, and other budgets January For the Month Ended April 30, 2015 Purchases of material February $18,000 $18,000 $18,000 0,000 80,000 60,000 30,000 40,000 30,000 40,000 30,000 30,000 30,000 Cah babnce, beginning Selling and admin. expenses Collections from customers $209,000 $229,000 $216,000 Equipment purchase $100,000 $120,000 $30,000 Schedule of Expected Cash Collections Accounts receivable, 113112015 Februory ales ($200,000) March les (220,000) pls ($180,000) Total cash collections Total disburseent (b) Minimum cash balance Total cash needed [c] Cosh surplus (deficit) (o)-[c] $247,000 167,000 $137,000 110,000 90,000 121,000 93,000 $265,000 185,000 $155,000 131,000 211,000 198,000 Schedule of Expected Cash Poyments Tot?? effect of financing Cash balance, ending [io)-(b)+ February March April (338,000) $62,000 $79,000 Accounts payable, 113112015 rchases 70,000 40,000 80,000 30,000 Total cash disbursement 100,000 120,000 30,000

Explanation / Answer

Solution:

Cash Budget - Ritewell Publishers Particular February March April Cash balance, beginning $18,000.00 $18,000.00 $18,570.00 Add: Receipts: Collection from customers $191,000.00 $211,000.00 $198,000.00 Total cash avaialble (A) $209,000.00 $229,000.00 $216,570.00 Less: Disbursements: Direct material $100,000.00 $120,000.00 $90,000.00 Selling & Admin $30,000.00 $30,000.00 $30,000.00 Equipment Purchase $100,000.00 $0.00 $0.00 Dividends $3,000.00 $3,000.00 $3,000.00 Income Tax $14,000.00 $14,000.00 $14,000.00 Total Disbursements (B) $247,000.00 $167,000.00 $137,000.00 Minimum cash balance $18,000.00 $18,000.00 $18,000.00 Total Cash needed ( C) $265,000.00 $185,000.00 $155,000.00 Cash surplus (Deficit) (A - C) -$56,000.00 $44,000.00 $61,570.00 Finance: Borrowings $56,000.00 $0.00 $0.00 Repayment $0.00 $43,000.00 $13,000.00 Interest $0.00 $430.00 $195.00 Total effect of financing (D) $56,000.00 -$43,430.00 -$13,195.00 Cash balance, ending (A - B + D) $18,000.00 $18,570.00 $66,375.00

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