Fish River Seafood Restaurant provides you with the following information.

	May	June	July
Sales	$51,000	$45,000	$55,000
Cost of Sales	12,750	11,250	13,750
Capital Expenditures (new equipment)	4,000		1,200
Administrative Costs (excluding depreciation)	25,000	21,000	19,000

Expectations:

Cash sales represent 10% of total sales; the balance is credit card sales.

Of the credit card sales, 90% are collected in the month of sale and the remaining 10% will be collected in

the following month.

The credit card sales in April amounted to $45,000.

Inventory purchases are expected to be 25% of sales and are to be paid for in the month in which they are

purchased.

Wages are expected to be 30% of sales and are to be paid in the month in which they are incurred.

Administration costs are to be paid in the month in which they are incurred.

Advertising costs of $1,000 are expected to be paid in June and in July.

Fish River must have at least a $10,000 cash balance at the end of each month. Borrowing is in multiples of

$1,000.

Excess cash over the required minimum cash balance must be used towards paying off any outstanding

loan. Ignore interest on the loan.

The balance of the loan as of May 1 is $0.

The balance of cash as of May 1 is $15,000.

Prepare a cash budget for each month in the quarter and the quarter as a whole.

Fish river Seafood restaurant Cash Budget For the Quarter ending July 31, 2020
	May	June	July	Quarter