At the beginning of the school year, Craig Kovar decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:

Cash balance, September 1 (from a summer job)	$6,670
Purchase season football tickets in September	90
Additional entertainment for each month	230
Pay fall semester tuition in September	3,600
Pay rent at the beginning of each month	320
Pay for food each month	180
Pay apartment deposit on September 2 (to be returned December 15)	500
Part-time job earnings each month (net of taxes)	830

a. Prepare a cash budget for September, October, November, and December. Use the minus sign to indicate cash outflows, a decrease in cash or cash payments.

Craig Kovar Cash Budget For the Four Months Ending December 31

	September	October	November	December
Estimated cash receipts from:
Additional entertainmentFoodPart-time jobRentTuition	$- Select -	$- Select -	$- Select -	$- Select -
Additional entertainmentDepositFoodRentTuition				- Select -
Total cash receipts	$fill in the blank 103efdfe406f04c_8	$fill in the blank 103efdfe406f04c_9	$fill in the blank 103efdfe406f04c_10	$fill in the blank 103efdfe406f04c_11
Less estimated cash payments for:
CashInsuranceMovie ticketsPart-time jobSeason football tickets	$- Select -
Additional entertainmentCashInsuranceMovie ticketsPart-time job	- Select -	$- Select -	$- Select -	$- Select -
CashInsuranceMovie ticketsPart-time jobTuition	- Select -
CashInsuranceMovie ticketsPart-time jobRent	- Select -	- Select -	- Select -	- Select -
CashFoodInsuranceMovie ticketsPart-time job	- Select -	- Select -	- Select -	- Select -
DepositInsuranceMovie ticketsPart-time jobPrepaid rent	- Select -
Total cash payments	$fill in the blank 103efdfe406f04c_33	$fill in the blank 103efdfe406f04c_34	$fill in the blank 103efdfe406f04c_35	$fill in the blank 103efdfe406f04c_36
Cash increase (decrease)	$fill in the blank 103efdfe406f04c_37	$fill in the blank 103efdfe406f04c_38	$fill in the blank 103efdfe406f04c_39	$fill in the blank 103efdfe406f04c_40
Less cash balance at beginning of monthPlus cash balance at beginning of month	- Select -	- Select -	- Select -	- Select -
Cash balance at end of month	$fill in the blank 103efdfe406f04c_46	$fill in the blank 103efdfe406f04c_47	$fill in the blank 103efdfe406f04c_48	$fill in the blank 103efdfe406f04c_49

c. What are the budget implications for Craig Kovar?

Craig can see that his present plan

will providewill not providewill not provide

sufficient cash. If Craig did not budget but went ahead with the original plan, he would be $fill in the blank 67e42e04b030fc2_3

overshortshort

at the end of December, with no time left to adjust.

Answer rating: 100% (QA)

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