The following table lists data from the budget of Ritewell Publishers. Half the
ID: 2771727 • Letter: T
Question
The following table lists data from the budget of Ritewell Publishers. Half the company's sales are for cash on the nail; the other half are paid for with a one-month delay. The company pays all its credit purchases with a one-month delay. Credit purchases in January were $36, and total sales in January were $192.
Complete the cash budget in the following table. (Leave no cells blank - be certain to enter "0" whenever required. Negative amounts should be indicated by a minus sign.)
Feb. Mar. Apr. Total sales $212 $232 $192 Purchases of materials for cash 76 86 66 for credit 46 36 46 Other expenses 36 36 36 Taxes, interest, and dividends 16 16 16 Capital investment 75 0 0Explanation / Answer
(in USD) Feb. Mar. Apr. Sources of cash: --- --- --- collections on cash sales 106 116 96 collections on accounts receivables 96 106 116 TOTAL SOURCES OF CASH 202 222 212 Uses of cash: --- --- --- Payments of accounts payable 36 46 36 cash purchases of materials 76 86 66 other expenses 36 36 36 capital expenditures 75 0 0 taxes, interest, and dividends 16 16 16 TOTAL USES OF CASH 239 184 154 Net cash inflow (Sources - Uses) -37 38 58 Cash at start of period 100 63 101 + Net cash inflow -37 38 58 Cash closing balance 63 101 159 + Minimum operating cash balance 100 100 100 Cumulative short term financing required 37 -1 -59 Negative cumulative short term financing indicates surplus
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