Personal Budget

At the beginning of the school year, Katherine Malloy decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:

Cash balance, September 1 (from a summer job)	$5,750
Purchase season football tickets in September	210
Additional entertainment for each month	275
Pay fall semester tuition in September	3,700
Pay rent at the beginning of each month	600
Pay for food each month	235
Pay apartment deposit on September 2 (to be returned December 15)	500
Part-time job earnings each month (net of taxes)	1,400

a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.

KATHERINE MALLOY
Cash Budget
For the Four Months Ending December 31
	September	October	November	December
Estimated cash receipts from:
Part-time job	$	$	$	$
Deposit
Total cash receipts	$	$	$	$
Estimated cash payments for:
Season football tickets	$
Additional entertainment		$	$	$
Tuition
Rent
Food
Deposit
Total cash payments	$	$	$	$
Overall cash increase (decrease)	$	$	$	$
Cash balance at beginning of month
Cash balance at end of month	$	$	$	$

b. Are the four monthly budgets that are presented prepared as static budgets or flexible budgets?

c. Malloy can see that her present plan sufficient cash. If Malloy did not budget but went ahead with the original plan, she would be $ at the end of December, with no time left to adjust.

Flexible Budget for Selling and Administrative Expenses for a Service company

Morningside Technologies Inc. uses flexible budgets that are based on the following data:

Sales commissions	15% of sales
Advertising expense	12% of sales
Miscellaneous administrative expense	$8,000 per month plus 10% of sales
Office salaries expense	$32,000 per month
Customer support expenses	$14,000 per month plus 18% of sales
Research and development expense	$35,000 per month

Prepare a flexible selling and administrative expenses budget for April for sales volumes of $400,000, $500,000, and $600,000.

MORNINGSIDE TECHNOLOGIES INC.
Flexible Selling and Administrative Expenses Budget
For the Month Ending April 30
Total sales	$400,000	$500,000	$600,000
Variable cost:
Sales commissions	$	$	$
Advertising expense
Miscellaneous administrative expense
Customer support expense
Total variable cost	$	$	$
Fixed cost:
Miscellaneous administrative expense	$	$	$
Office salaries expense
Customer support expense
Research and development expense
Total fixed cost	$	$	$
Total selling and administrative expenses	$	$	$