Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Creasy expects 1 0 % of sales to be collected in cash from the customer immediately and 9 0 % on credit. Credit sales are
Creasy expects of sales to be collected in cash from the customer immediately and on credit. Credit sales are always paid in full in the following month.All direct materials purchases are on credit and are paid in full in the following month. No other payables arise from any other transactions.As of June the Accounts Receivable balance is $ The Accounts Payable balance is $The minimum ending cash balance for all months is $ If necessary, the company borrows enough cash using a short term note to reach the minimum.Short term notes require an interest payment of each month end before repayment If the ending cash balance exceeds the minimum, the excess will be applied to repaying the short term notes payable balance.The company expects to declare and pay a dividend of $ in July.The company does not expect to make any payments for Income Taxes in the budgeted quarter.Equipment purchases of $ are scheduled for September. No disposals of fixed assets are anticipated.Using this information plus the information you prepared in the previous questions, prepare the Cash Budget.Cash BudgetCash BudgetJulyAugustSeptemberBudgeted Sales DollarsCash SalesCollections of Accounts ReceivableTotal Cash ReceiptsBeginning CashCash ReceiptsDirect MaterialsDirect LaborVariable OverheadFixed Overhead cash portion onlySales CommissionsSales SalariesG&A SalariesInterest on Long Term Notes PayableInterest on Short Term Notes PayableDividendsCapital ExpendituresTotal PaymentsPreliminary CashCash borrowed or repaid on short term notesEnding Cash
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started