Required information Problem 7-2A (Algo) Manufacturing: Cash budget and schedule of cash payments LO P2 Skip to question [The following information applies to the questions displayed below.] Built-Tight is preparing its master budget. Budgeted sales and cash payments follow: July August September Budgeted sales $ 55,000 $ 71,000 $ 57,000 Budgeted cash payments for Direct materials 15,360 12,640 12,960 Direct labor 3,240 2,560 2,640 Overhead 19,400 16,000 16,400 Sales to customers are 20% cash and 80% on credit. Sales in June were $52,500. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $51,000 in cash and $4,200 in loans payable. A minimum cash balance of $51,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $51,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $51,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,200 per month), and rent ($5,700 per month).

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! Required information Problem 7-2A (Algo) Manufacturing: Cash budget and schedule of cash payments LO P2 [The following information applies to the questions displayed below.) Built-Tight is preparing its master budget. Budgeted sales and cash payments follow: July $ 55,000 August $ 71,000 September $ 57,000 Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead 15,360 3,240 19,400 12,640 2,560 16,000 12,960 2,640 16,400 Sales to customers are 20% cash and 80% on credit. Sales in June were $52,500. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $51,000 in cash and $4,200 in loans payable. A minimum cash balance of $51,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $51,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $51,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,200 per month), and rent ($5,700 per month). Problem 7-2A (Algo) Part 2 2. Prepare a cash budget for the months of July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Enter your final answers in whole dollars.) BUILT-TIGHT Cash Budget July August 51,000 $ 51,000 September $ Beginning cash balance Add: Cash receipts Total cash available Less: Cash payments for Direct materials Direct labor Overhead Sales commissions Office salaries Rent 15,360 3,240 19,400 5,500 3,200 5,700 12,640 2,560 16,000 7,100 3,200 5,700 12,960 2,640 16,400 5,700 3,200 5,700 52,400 47,200 46,600 Total cash payments Preliminary cash balance Loan activity Additional loan Repayment of loan to bank Ending cash balance 0 0 0 Loan balance July August September Loan balance - Beginning of month Loan balance July August September Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month