Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question 1- Budgeting 8 pts Milano Interior Ltd is a small business that sell designer homewares. It has two stores in Auckland. The owner, Estella,
Question 1- Budgeting 8 pts Milano Interior Ltd is a small business that sell designer homewares. It has two stores in Auckland. The owner, Estella, has partially completed the cash budget for the fourth quarter of 2021. Milano Interior Ltd - Cash Budget for the fourth quarter 2021 October $39,000 November December Quarter $48,000 $55,000 -$13,650 -$19,250 -$49,700 -$11,000 -$11,000 -$11,000 -$33,000 -$10,000 -$10,000 -$10,000 -$30,000 Cash receipts from Sales Less Cash payments: Cash pay for inventory purchase Cash pay for salary Cash pay for selling & admin expenses Cash payment for sales commission Cash payment for a store refurbishment Total Payments =Net cash from operations Add: Beginning Cash balance =Ending cash balance -$1,950 -$2,400 -$2,750 -$7,100 -$15,000 -$15,000 -$51,600 -$12,600 $7,200 -$43,000 $12,000 $200 $12,200 -$7,600 $200 -$7,600 $12,200 Required: a) Complete the incomplete budget above by working out the following amounts: Beginning cash balance for October; Cash pay for inventory purchase for November; Total payments and Net cash from operations in November; Total cash receipts from sales, Total payments and Beginning cash balance for the Quarter. (6 marks) b) Estella foresees a cash flow problem in the fourth quarter. Explain two ways the business can address the problem. (2 marks)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started