Hello, I would like to have your help in solving this problem. Many thanks in advance.

Below is the problem to solve.

December 2019: you have raised 250.000 from a capital venture that you have convinced to invest in your project as a shareholder. This money goes straight to cash (starting cash)

Next decision that you have made, together with your partners/friends is to rent an office for 2.000 / month (6.000 per quarter)

One of you will be in charge of assemble the computers (his salary is labor cost) and the other 2 of you will be doing sales and marketing (S&A). The three of you will get 2.000 / month as salary (company cost).

You are hiring a marketing company that charges you 1.500 / month.

Other SG&A costs: 1.200 / month

Assume that you are going to start operations in January, so no revenues nor expenses will be carried during December.

You need to develop a quarterly budget for 2020 with this information:

Expected sales:

After a market analysis you have decided to fix a sell price per computer = 350

You are expecting to collect money from your customers the quarter after the sale (90 days payment).

Factory overhead fix cost is zero and Factory overhead variable cost is 30 per PC

You start with no inventory, but you need to place an order soon in January to meet the production for expected sales.

You decided to leave enough inventory at the end of each quarter to cover 10% of next quarter sales needs. In Q4 you leave same ending inventory as in Q3

Direct material costs per PC is 195. You must pay your suppliers in cash.

You can assume in COGS, the production cost of the same quarter without having to carry the cost of the units that you are selling coming from the previous quarter stock. The error is lower than 200 and it simplifies calculations a lot.

Based on the information provided above, Solve the Following (to be filled in cells)

Cash Budget CASH IN (cash collection) Q1-202002-202003-2020 Q4-2020 Cash from sales CASH OUT 02-2020 03-2020 01-2020 04-2020 Production SGBA CAPEX CASH FLOW Q2-202003-2020 Q1-2020 Q4-2020 Starting cash Cash in Cash out Ending cash Balance Sheet LIABILITIES ASSETS Cash Inventories A/R Equipment Adjustments OWNER EQUITY Capital Acum. Earnings TOTAL ASSETS TOTAL L. + O.E. Cash Budget CASH IN (cash collection) Q1-202002-202003-2020 Q4-2020 Cash from sales CASH OUT 02-2020 03-2020 01-2020 04-2020 Production SGBA CAPEX CASH FLOW Q2-202003-2020 Q1-2020 Q4-2020 Starting cash Cash in Cash out Ending cash Balance Sheet LIABILITIES ASSETS Cash Inventories A/R Equipment Adjustments OWNER EQUITY Capital Acum. Earnings TOTAL ASSETS TOTAL L. + O.E