required cash budget - december balance is 70000 and maretable security is 30000
Required # 1 - Sales Budget March Decemb er 800,000 200000 600000 Februa January ry 880000 968000 220000 242000 660000 726000 1064800 266200 First Quarter 2912800 728200 2184600 798600 Total Sales Cash Sales Sales on Account Total Sales increase by 10% each month Credit sales are 75% of total sales. So, the cash sales are 25 % of total sales Required # 2 - Schedule of Expected Cash Collection Cash Sales Cash collection from credit sales made during current month Cash collection from credit sales made during preceding month Total Receipt of Cash Februar January March 220000 242000 266200 66000 72600 79860 540000 594000 653400 826000 908600 999460 First Quarter 728200 218460 1787400 2734060 Required 3 - Purchase Budget March 745360 409948 First Quarter 2038960 Decemb Februa er January 560000 616000 677600 308000 338800372680 105028 868000 954800 0 0 308000 338800 868000 646800 711480 Budgeted Cost of Good Solds Add: Desired Ending Inventory Total Needed Less: Beginning Inventory Purchases 1121428 1155308 372680 782628 3160388 1019480 2140908 Required # 4 - Schedule of expected cash disbursement for inventory purchase Months Total Budged Purchase January 646800 Februar March 711480 782628 Quarter 2140908 258720 284592 388ORO 40 % of current mont purchase will be paid in Current month 60% of previous month purchase will be paid in current month Expected Cash disbursement for inventory purchase 520800 313051 2 8563632 426888 1335768 739939 -2 21921312 779520 672672 Required #5 - Schedule of expected cash disbursement for operations expense January 42000 Februar Y 42000 March 42000 Quarter 126000 96000 32000 42000 32000 42000 32000 42000 Months Salaries Advertising Admin Expense Bond Interest Property Tax Commission Total Expenses 126000 30,000 30,000 10800 9680 10800 29128 10648 8800 154800 196480 126648 417928 Sales salaries 42,000 Advertising and promotion 32,000 Administrative salaries 42,000 Depreciation 50.000 Interest on bonds 5,000 Property taxes 1,800 In addition, sales commission run at the rate of 1% of sales. 4. Company president has indicated that the firm should invest 250,000 in an automated inventory handling system to control the movement of inventory in the firm s' warehouse just after the new year begins. These equipment purchase will be finance primarily from the firm cash and marketable securities. However, president believes that the company needs to keep minimum cash balance of 50,000. If necessary, the remainder of the equipment purchase will be financed using the short term credit from local bank. The minimum period for such a loan is three months. Hanson believes short term interest rate will be 10% per year at the time of equipment purchase. If a loan is necessary President has decided it should be paid off by the end of the first quarter if possible. 5. Company board of directors has indicated an intention to declare and pay dividends of 100,000 on the last day of each quarter 6. The interest on any short - term borrowing will be paid when the loan is repaid. Interest on bonds is paid semiannually on January 31 and July 31 for the preceding six- month 7. Property taxes are paid semiannually on February 28 and August 31 for the preceding six-month Required: Prepare Global Electronics Company is master budget for the first quarter 2021 by completing the following schedules and statements
