Cash Budget with Supporting Cash Collections and Disbursements Schedules 1. Prepare a sales budget, including a schedule of expected cash collections. 2. Prepare a direct materials budget, Including a schedule of expected cash disbursements for purchases of materials. 3. Prepare a cash budget. A B D 1 S & P Enterprises needs a cash budget for March. The following Information is available. 2 3 Data January February March 4 Actual January and February and expected March sales: 5 Cash sales $ 1,600 $ 3,750 $ 5,100 6 Sales on account 25,000 30,000 40,000 7 Total Sales $ 26,600 S 33.750 $45,100 8 9 Accounts Receivable Collections: 10 Month of sale 15% 11 Month following sale 60% 12 Second month following sale 22% 13 Uncollectible 3% 14 15 Accounts payable for inventory purchases, March 1 balance $10,500 16 Budgeted inventory purchases in March $23,500 17 Inventory payments: 18 Month of purchase 60% 19 40% Month following purchase 20 21 Total budgeted selling & administrative expenses in March $12,500 $3,200 22 Budgeted selling & administrative depreciation in March 23 A45 B D 21 Total budgeted selling & administrative expenses in March $12,500 22 Budgeted selling & administrative depreciation in March $3,200 23 24 Other budgeted cash disbursements in March 25 Equipment purchases $14,000 26 Dividends to be paid $2,000 27 28 Minimum cash balance to be maintained $10,000 29 March 1 cash balance $11,500 30 March 1 outstanding borrowings $0 31 March 1 interest due $0 32 33 The company has a line of credit available to bolster the cash balance as needed. 34 35 When preparing budgets, the company maintains their data on a separate sheet from the actual budget and schedules. 36 37 Click the Schedules and Cash Budget tab to prepare the following: 38 1. Schedule of expected cash collections for March. 2. Schedule of expected cash disbursements for inventory purchases for March. 3. Cash budget for March. Indicate in the financing section any borrowing that will be needed in March. Assume that any interest will not be paid until the following month. 42 39 40 41 43 44 45 Budget Data Schedules and Cash Budget ER DEID