At the beginning of the school year, Katherine Malloy 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)	$6,970
Purchase season football tickets in September	90
Additional entertainment for each month	240
Pay fall semester tuition in September	3,800
Pay rent at the beginning of each month	340
Pay for food each month	190
Pay apartment deposit on September 2 (to be returned December 15)	500
Part-time job earnings each month (net of taxes)	860

Question Content Area

a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.

KATHERINE MALLOY Cash Budget For the Four Months Ending December 31

	September	October	November	December
Estimated cash receipts from:	X	X	X	X
Part-time job
Deposit	X	X	X
Total cash receipts
Estimated cash payments for:	X	X	X	X
Season football tickets		X	X	X
Additional entertainment
Tuition		X	X	X
Rent
Food
Deposit		X	X	X
Total cash payments
Overall cash increase (decrease)
Cash balance at beginning of month
Cash balance at end of month

Spaces with X's do not require an entry.

b. Are the four monthly budgets that are presented prepared as static budgets or flexible budgets?

c. Malloy can see that her present plan will not provide sufficient cash. If Malloy did not budget but went ahead with the original plan, she would be $________ short at the end of December, with no time left to adjust.