Exercise 23-14 Danner Company expects to have a cash balance of $56,115 on Janua

Question

Exercise 23-14 Danner Company expects to have a cash balance of $56,115 on January 1, 2017. Relevant monthly budget data for the first 2 months of 2017 are as follows: Collections from customers: January $105,995, February $187,050 Payments for direct materials: January $62,350, February $93,525. Direct labor: January $37,410, February $56,115. Wages are paid in the month they are incurred. Manufacturing overhead: January $26,187, February $31,175. These costs include depreciation of $1,870 per month. All other overhead costs are paid as incurred. Sg and administrative expenses: January $18,705, February $24,940. These costs are exclusive of depreciation. They are paid as incurred sales of marketable securities in January are expected to realize $14,954 in cash. Danner Company has a line of credit at a local bank that enables it to borrow up to $31,175. The company wants to maintain a minimum monthly cash balance of $24,940 Prepare a cash budget for January and February.(Do not leave any answer field blank. Enter "o" for amounts.) DANNER COMPANY Cash Budgeft

Explanation / Answer

DANNER COMPAY Cash Budget For the Months of January and February 2017 January February Beginning cash balance $ 56115 34292 Add: Cash receipts Collections from customers 105995 187050 Sale of marketable securities 14964 0 Total cash receipts 120959 187050 Total cash available 177074 221342 Less cash disbursements: Payments for direct materials 62350 93525 Payment of wages 37410 56115 Manufacturing overhead 24317 29305 Selling and administrative expenses 18705 24940 Total cash disbursements 142782 203885 Excess of cash available over disbursements 34292 17457 Financing: Add: Borrowings 0 7483 Less: Repayments 0 0 Ending cash balance $ 34292 24940

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.