Problem 24-01

A firm has the following monthly pattern of sales:

January	$	200
February		500
March		800
April		1,400
May		800
June		500

Fifty percent of the sales are on credit and are collected after a month. The company pays wages each month that are 65 percent of sales and has fixed disbursements (for example, rent) of $150 a month. In March it receives $150 from a bond that matures; in April and June it makes a tax payment of $250. Management maintains a cash balance of $150 at all times. Construct a cash budget that indicates the firms monthly needs for short-term financing. Its beginning cash position is $150. Round your answers to the nearest dollar. Enter the disbursements values in Part 2 and desired level of cash in Part 3 as positive values. Use a minus sign to enter cash outflows, shortage of cash values, negative initial and ending cash positions in Part 3, if any. Do not leave any cells blank. If the answer is zero, enter "0".

Part 1	January	February	March	April	May	June
Anticipated sales	$	$	$	$	$	$
Cash sales	$	$	$	$	$	$
Accounts collected	$	$	$	$	$	$
Other receipts	$	$	$	$	$	$
Total receipts	$	$	$	$	$	$
Part 2
Variable disbursements	$	$	$	$	$	$
Fixed disbursements	$	$	$	$	$	$
Other disbursements	$	$	$	$	$	$
Total cash disbursements	$	$	$	$	$	$
Part 3
Net change in cash	$	$	$	$	$	$
Initial cash position	$	$	$	$	$	$
Ending cash position	$	$	$	$	$	$
Desired level of cash	$	$	$	$	$	$
Excess (shortage) of cash	$	$	$	$	$	$