Deitz Corporation is projecting a cash balance of $30,450 in its December 31, 20

Question

Deitz Corporation is projecting a cash balance of $30,450 in its December 31, 2016, balance sheet. Deitz’s schedule of expected collections from customers for the first quarter of 2017 shows total collections of $187,775. The schedule of expected payments for direct materials for the first quarter of 2017 shows total payments of $43,645. Other information gathered for the first quarter of 2017 is sale of equipment $3,045; direct labor $71,050, manufacturing overhead $35,525, selling and administrative expenses $45,675; and purchase of securities $14,210. Deitz wants to maintain a balance of at least $25,375 cash at the end of each quarter.

Prepare a cash budget for the first quarter. (Do not leave any answer field blank. Enter 0 for amounts.)

Explanation / Answer

Cash Budget For the Quarter Ended March 31, 2017 Beginning Cash Balance 30450 Add: Receipts Collections from Customers 187775 Sale of Equipment 3045 Total Receipts 190820 Total Available Cash 221270 Less: Disbursements Direct Materials 43645 Direct Labor 71050 Manufacturing Overhead 35525 Selling and Administrative Expenses 45675 Purchase of Securities 14210 Total Disbursements 210105 Excess (Deficiency) of Available Cash Over Cash Disbursements 11165 Financing Add: Borrow ings 14210 Less: Repayments 0 Ending Cash Balance 25375

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