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1. Prepare a cash disbursements budget. 2. Prepare a cash budget. Razja buys beaded necklaces from aboriginal women in Thunder Bay. She then sells them
1. Prepare a cash disbursements budget. 2. Prepare a cash budget. Razja buys beaded necklaces from aboriginal women in Thunder Bay. She then sells them at craft fairs throughout Canada. Her balance sheet as of the end of June is as follows: Cash A/R Inventory Equipment (net) 124,600 2,400 4,895 7,500 A/P Loan Payable Common Shares Retained Earnings $2,750 14,000 50,000 72,645 Razja wants to prepare a budget for the upcoming quarter (July, August and September) She has gathered the following information . The cost of each necklace is $5 . One third of all sales are on account. On average, 20% of the credit sales are collected in the month of the sale, 60% the following month and 15% the month after. As indicated by the collection history, the firm experiences an average of 5% uncollectible accounts. In August, Razja has scheduled to have a completely new engine installed in the mobile home that she uses to travel between fairs. She has this done every three years. It will cost $20,000. Sales for May were $20,900. Sales for June were $15,400. In May, 2,200 units were purchased The selling price of the necklaces is S11 each. Repairs and maintenance on the mobile home average $6,000 per month. Amortization on the mobile home is $60,000 per year. On average, fees at the craft shows amount to 15% of sales. . On average, Razja sells 600 necklaces at each show. She plans to attend 5 shows in July, 8 in August, 4 in September, and 2 in October
1. Prepare a cash disbursements budget.
2. Prepare a cash budget.
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