Assume the following data for Animal Transport Company: (Click the icon to view the assumptions.) 2(Click the icon to view budget information.) Requirements 1. Prepare a cash budget for April for Animal Transport 2. Why do Animal Transport's managers prepare a cash budget in addition to the revenue, expenses, and operating income budget? Requirement 1. Prepare a cash budget for April for Animal Transport Begin the cash budget by calculating the cash available, then total disbursements, and finally the effects of financing and the ending cash balance. (Round your answers to the nearest whole dollar. Enter "O" for repayment of loan if excess cash does not exceed $10,000 at the end of April.) Cash Budget April 30 Cash balance, beginning Add receipts (1) Cash sales (2) Credit card sales Total cash available for needs Deduct disbursements (3) Direct materials (4) Direct Manufacturing Labor (5) Manufacturing Overhead (6) Non Manufacturing Salaries (7) Sales Commissions (8) Other Non Manufacturing fixed costs (9) Machinery Purchase (10) Income taxes Total disbursements Cash excess (deficiency) Financing Repayment of loan Interest on loan Total effects of financing Ending cash balance, April 30 Requirement 2. Why do Animal Transport's managers prepare a cash budget in addition to the revenue, expenses, and operating income budget? Animal Transport's managers prepare a cash budget in addition to the operating income budget to (11) If Animal Transport's managers may then Animal Transport is profitable on an accrual accounting basis, (12) need to (13) Building a profitable operating plan (14) that adequate cash will be available. 1: More Info Animal Transport (AT) does not make any sales on credit. AT sells only to the public and accepts cash and credit cards; 90% of its sales are to customers using credit cards, for which AT gets the cash right away, less a 3% transaction fee. Purchases of materials are on account. AT pays for half the purchases in the period of the purchase and the other half in the following period. At the end of March, AT owes suppliers $8,800. During April they plan to purchase direct materials worth $21,110 AT plans to replace a machine in April at a net cash cost of $13,900. Labor, other manufacturing costs, and nonmanufacturing costs are paid in cash in the month incurred except of course depreciation, which is not a cash flow. Depreciation is $20,000 of the manufacturing cost and $11,500 of the nonmanufacturing (fixed) cost for April. AT currently has a $2,600 loan at an annual interest rate of 24%. The interest is paid at the end of each month. If AT has more than $10,000 cash at the end of April it will pay back the loan. AT owes $5,300 in income taxes that need to be remitted in April. AT has cash of $5,000 on hand at the end of March. 2: Reference Revenue Budget For the Month of April Units Selling price Total Revenues 530 $ 205 $ 108,650 Cat-allac Dog-eriffic 265 82,150 310 S Total 190,800 Manufacturing Overhead Budget For the Month of April Machine setup costs $ 8,715 Processing costs 108,000 465 Inspection costs $ Total 117,180 Direct Manufacturing Labor Costs Budget For the Month of April Output units DMLH Total Hourly produced per unit Hours Wage Rate 550 3 1,650 $ 10 $ Total Cat-allac 16,500 Dog-eriffic 250 5 1,250 10 12,500 Total $ 29,000 Nonmanufacturing Costs Budget For the Month of April Salaries $ 18,800 Other fixed costs 15,000 Sales commissions 1,908 $ 35,708 Total nonmanufacturing costs