Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Brownstein , Inc., expects sales of $ 9 6 comma 0 0 0 during each of the next 3 months. It will make monthly purchases

Brownstein, Inc., expects sales of $ 96 comma 000 during each of the next 3months. It will make monthly purchases of $ 63 comma 000 during this time. Wages and salaries are $ 13 comma 000 per month plus 5% of sales. Brownstein expects to make a tax payment of $ 19 comma 000 in the next month and a $ 12 comma 000 purchase of fixed assets in the second month and to receive $ 7 comma 000 in cash from the sale of an asset in the third month. All sales and purchases are for cash. Beginning cash and the minimum cash balance are assumed to be zero.
a. Construct a cash budget for the next 3 months.
b. Brownstein is unsure of the sales levels, but all other figures are certain. If the most pessimistic sales figure is $ 76 comma 000 per month and the most optimistic is $ 115 comma 000 per month, what are the monthly minimum and maximum ending cash balances that the firm can expect for each of the1-month periods?
c. Briefly discuss how the financial manager
Construct a cash budget for the next 3 months.
Complete the Brownstein, Inc.'s cash budget for the 1st month below: (Round to the nearest $000.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Handbook Of Mortgage Backed Securities

Authors: Frank Fabozzi

6th Edition

0071460748, 978-0071460743

More Books

Students also viewed these Finance questions