Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Kashi is preparing the cash budget for the first 3 months of her business's trading. Business is called Kashi textiles and Kashi will be

 

Kashi is preparing the cash budget for the first 3 months of her business's trading. Business is called Kashi textiles and Kashi will be investing 25,000 of her personal savings to get it started. Rest of the information is as follows: a. In January 2022, Kashi will purchase a computer and a printer for use in the business for 1,980, payable upfront. b. Kashi expects to sell the following textiles: January 4,500 to Moon Traders February 6,890 to Hans Traders March 5,670 to Down Town shops. c. Kashi expects to make the following purchases of textiles over the next three months: 3,280 for Moon Traders supplies 5,120 for Hans Traders supplies 4,100 for Down Town shops' supplies January February March d. All sales will be made for cash. e. Purchases: 10% payment in the same month, 50% payment next month and remaining payment in 2 months' time. f. Kashi will need to hire a printing machine to print her logos and the hiring charges will be 250 per month, payable in the same month. Hiring will be made in January and will be needed for all the subsequent trading months. g. Kashi has agreed to pay 250 per month to an accountant for his advice and preparation of accounts. h. Other expenses have been estimated as follows: 100 on delivery costs per month, payable at the end of each month. 425 on telephone costs per quarter, payable at the end of the quarter. 250 on other expenses, such as electricity and insurance, payable at the end of each month. i. Kashi will be withdrawing 700 per month to cover her personal expenses. Prepare the cash budget for Kashi textiles for first 3 months' of trading from January to March, 2022.Show your workings separately. (25 Marks)

Step by Step Solution

3.53 Rating (153 Votes )

There are 3 Steps involved in it

Step: 1

The cash budget is tabulated below January February March Opening cash balance 0 25642 28830 ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting Tools for business decision making

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

6th Edition

978-0470477144, 1118096894, 9781118214657, 470477148, 111821465X, 978-1118096895

More Books

Students also viewed these Finance questions