% E6-34 (similar to) Question Help Best Breath is a retail store selling home oxygen equipment. Best Breath also services home oxygen equipment, for which the company bills customers monthly. Best Breath has budgeted for increases in service revenue of $500 each month due to a recent advertising campaign. The forecast of sales and service revenue for March-June 2018 is as follows: (Click the icon to view the forecast of sales and service revenue.) (Click the icon to view the collection information.) Read the requirements. Data Table Gross Expected Revenue Collection % April May June Sales revenue: 9,000 x 97% 8,730 Month April sales revenue collected in Apr May sales revenue collected in May June sales revenue collected in June 97% 8,245 8,500 x 9,600 X March Sales and Service Revenues Budget March-June 2018 Expected Sales Revenue Expected Service Revenue $ 7,000 $ 4,300 9,000 4,800 8,500 5,300 Total Revenue $ 11,300 13,800 97% 9,312 April May June Service revenue: March service revenue collected in Apr. March service revenue collected in May 13,800 30% 1,290 9,600 5,800 15,400 4,300 x 4,300 x 0% 0 March service revenue collected in June 4,300 x 0% 0 Print Done 70% = 3,360 4,800 x 4,800 x 30% 1,440 April service revenue collected in Apr. April service revenue collected in May April service revenue collected in June May service revenue collected in May May service revenue collected in June 4,800 x 0% 0 70% 3,710 5,300 x 5,300 x 30% 1,590 4,060 June service revenue collected in June 5,800 x 70% = 13,380 $ 13,395 $ 14,962 Total mellaneous Requirement 2a. Best Breath has budgeted expenditures for May of $13,200 and requires a minimum cash balance of $210 at the end of each month. It has a cash balance on May 1 of $200. Given your answer to requirement 1, will Best Breath need to borrow cash to cover its payments for May and maintain a minimum cash balance of $210 at the end of May? The total cash available for May exceeds the budgeted expenditures for the month; therefore, Best Breath will be able to cover its payments for May and maintain a minimum cash balance of $210 at the end of May. Requirement 2b. Assume (independently for each situation) that (1) May total revenues might be 10% lower or that (2) total costs might be 5% higher. Under each of those two scenarios, show the total net cash for May and the amount Best Breath would have to borrow to cover its cash payments for May and maintain a minimum cash balance of $210 at the end of May. (Again, assume a balance of $200 on May 1.) First calculate the cash excess or deficiency for May using the original numbers and under each scenario presented. On the next line, enter the amount of borrowing required. (Enter all amounts to the nearest cent. Enter a cash deficiency with a minus sign or parentheses. Complete all answer boxes. Enter a "0" if no borrowing is required.) Cash Budget For May Original May Revenues May Costs Numbers Decrease 10% Increase 5% Cash balance, beginning $ 200.00 $ 200.00 $ 200.00 Add receipts 13,395.00 12055.5 13,395.00 Total cash available for needs 13,595.00 12255.5 13,595.00 Total disbursements 13,200.00 13,200.00 13,860.00 Minimum cash balance desired 210.00 210.00 210.00 $ Total cash needed 13,410.00 13,410.00 $ 14.070.00 $ 185.00 Cash excess (deficiency) (1154.5) (474) % E6-34 (similar to) Question Help Best Breath is a retail store selling home oxygen equipment. Best Breath also services home oxygen equipment, for which the company bills customers monthly. Best Breath has budgeted for increases in service revenue of $500 each month due to a recent advertising campaign. The forecast of sales and service revenue for March-June 2018 is as follows: (Click the icon to view the forecast of sales and service revenue.) (Click the icon to view the collection information.) Read the requirements. Data Table Gross Expected Revenue Collection % April May June Sales revenue: 9,000 x 97% 8,730 Month April sales revenue collected in Apr May sales revenue collected in May June sales revenue collected in June 97% 8,245 8,500 x 9,600 X March Sales and Service Revenues Budget March-June 2018 Expected Sales Revenue Expected Service Revenue $ 7,000 $ 4,300 9,000 4,800 8,500 5,300 Total Revenue $ 11,300 13,800 97% 9,312 April May June Service revenue: March service revenue collected in Apr. March service revenue collected in May 13,800 30% 1,290 9,600 5,800 15,400 4,300 x 4,300 x 0% 0 March service revenue collected in June 4,300 x 0% 0 Print Done 70% = 3,360 4,800 x 4,800 x 30% 1,440 April service revenue collected in Apr. April service revenue collected in May April service revenue collected in June May service revenue collected in May May service revenue collected in June 4,800 x 0% 0 70% 3,710 5,300 x 5,300 x 30% 1,590 4,060 June service revenue collected in June 5,800 x 70% = 13,380 $ 13,395 $ 14,962 Total mellaneous Requirement 2a. Best Breath has budgeted expenditures for May of $13,200 and requires a minimum cash balance of $210 at the end of each month. It has a cash balance on May 1 of $200. Given your answer to requirement 1, will Best Breath need to borrow cash to cover its payments for May and maintain a minimum cash balance of $210 at the end of May? The total cash available for May exceeds the budgeted expenditures for the month; therefore, Best Breath will be able to cover its payments for May and maintain a minimum cash balance of $210 at the end of May. Requirement 2b. Assume (independently for each situation) that (1) May total revenues might be 10% lower or that (2) total costs might be 5% higher. Under each of those two scenarios, show the total net cash for May and the amount Best Breath would have to borrow to cover its cash payments for May and maintain a minimum cash balance of $210 at the end of May. (Again, assume a balance of $200 on May 1.) First calculate the cash excess or deficiency for May using the original numbers and under each scenario presented. On the next line, enter the amount of borrowing required. (Enter all amounts to the nearest cent. Enter a cash deficiency with a minus sign or parentheses. Complete all answer boxes. Enter a "0" if no borrowing is required.) Cash Budget For May Original May Revenues May Costs Numbers Decrease 10% Increase 5% Cash balance, beginning $ 200.00 $ 200.00 $ 200.00 Add receipts 13,395.00 12055.5 13,395.00 Total cash available for needs 13,595.00 12255.5 13,595.00 Total disbursements 13,200.00 13,200.00 13,860.00 Minimum cash balance desired 210.00 210.00 210.00 $ Total cash needed 13,410.00 13,410.00 $ 14.070.00 $ 185.00 Cash excess (deficiency) (1154.5) (474)