Ques 5

Prepare a cash budget for Rogue Company for the month of September of this year. The following information about the company's operations are as follows: a. The ending cash balance for August was $50,000. b. Actual sales for August were $100,000 and estimated sales for September are $150,000. C. 10% of August's sales were cash and the same is expected for September. Accounts receivable collection pattern is to receive 70% in the same month of the sale and 30% is received in the month following the sale. d. Purchase of inventory for August was $95,000 and for September it is estimated to be $80,000. Purchases are paid in cash in the month of purchase. e. Selling and administrative expenses are expected to be 90,000 which includes $5,000 in depreciation expense. f. Dividends in August were $30,000 and will be paid in September. g. The company must maintain a cash balance of 10,000 and has ready access for short term loans to finance cash deficiencies. Required: 1. Prepare a schedule of cash collected for the budgeted month. (5 Marks) 2. Prepare a cash budget, including borrowings if needed for the month. (10 Marks)