Bridgeport Corp. prepares monthly cash budgets. Here are relevant data from oper

Question

Bridgeport Corp. prepares monthly cash budgets. Here are relevant data from operating budgets for 2017.

January

February

All sales and purchases are on account. Budgeted collections and disbursement data are given below. All other expenses are paid in the month incurred except for administrative expenses, which include $1,100 of depreciation per month.

Other data.

The company’s cash balance on January 1, 2017, is expected to be $47,700. The company wants to maintain a minimum cash balance of $56,020.

Prepare a cash budget for January and February.

January

February

Sales $360,300 $400,600 Purchases 121,000 130,900 Salaries 84,400 81,200 Administrative expenses 71,600 73,900 Selling expenses 79,300 86,400

Explanation / Answer

Cash Budget for january and february Jan Feb Cash available at begning                47,700                59,100 Cash Collection             330,600             379,000 Collection of notes receivables                17,600                         -   Proceeds from sales of security                         -                    5,200 Total collection             348,200             384,200 Total Cash available             395,900             443,300 Cash disbursement Payments for purchases             102,600             143,100 Salaries                84,400                81,200 Selling expenses                79,300                86,400 Administrative expenses                70,500                72,800 other Disbursement                12,000 Total Disbursement             336,800             395,500 Net Cash Available                59,100                47,800 Borrowing                  8,220 Cash Balance available at the end                59,100                56,020

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