TCA 321-1006 Hospitality Accounting II Homework #3, Fall 2019 Student Name: March Sithabiso's Wraps is an all-organic restaurant located near State University. It is managed by Eunice Ndlovu, and Eunice is preparing her first-quarter cash budget for 2018. It is important to her because of the variation in volume caused by the return of the university students. Help Eunice complete her cash budget in the template provided next. First note the following forecast information and assumptions for Sithabiso's Wraps: Sithabiso's Wraps Cash Budget for the First Quarter of 2018 January February Estimated Cash- Beginning Estimated Cash Receipts: Food Revenues Cash Sales Collection of Account Receivable Dividend Revenue Total Cash Receipts Eunice has budgeted her revenues, cost of sales, and operating expenses based on forecasts for the months of January, February, and March. She expects to collect 80% of revenues in the month they are generated (current month) and the remaining 20% the next month as accounts receivable (AR) based on her aging of accounts receivable. She expects to collect in January $30,000 from accounts receivable from December She expects to pay 60% of the cost of sales in the month they are incurred (current month) and the remaining 40% the next month as accounts payable (AP). She expects to pay in January 19,000 from accounts payable for cost of sales from December She expects to pay 70% of her operating expenses in the month they are incurred (current month) and the remaining 30% the next month as accounts payable (AP). She expects to pay in January 921,000 from accounts payable for operating expenses from December. She expects to pay 100% of her nonoperating expenses in the month they are incurred She has rent expense of $4,000 per month. She pays an insurance premium of $6,000 in the first month of every quarter, and this premium is expensed immediately in the same month. Eunice expects to receive $300 in dividends from a stock investment. She expects to purchase a new range in February and, the cost is expected to be $7,000. Her beginning cash balance in January will be $5,000. Ending cash balance for one month is the beginning cash balance of the next month. She requires a minimum cash balance of $5,000 at all times (i.e. for emergencies). If the budgeted cash available in a given month is below S5,000, Eunice will borrow $5,000 short-term loan in that month from a local bank (no matter what amount the shortage is). This loan will be paid next month along with the 10% monthly interest (i.e. $5,500 will be paid.) Estimated Cash Disbursements: Cost of Sales Cash Payments Payment of Accounts Payable Operating Expenses Cash Payments Payment of Accounts Payable Nonoperating Expenses Rent Payment Insurance Payment Payment for Acquisition of Fixed Assets Total Cash Disbursements Preliminary Balance Minimum Cash Required Cash Excess or Shortage Short-term Borrowing Loan Repayment (including interest) Estimated Cash-Ending Given Data: March Revenues Cost of Sales Operating Expenses Nonoperating Expenses Rent Expense January 60,000 21,000 28,000 February 132,000 46,200 36,000 96,000 33,600 32,000 4,000 4,000 4,000 Insurance Premiums 6,000 Current Month 80% Second Month 20% 30,000 Schedule of Receipts (AR) AR from December (Received in January) Schedule of Payments (AP) Cost of Sales Operating Expenses Nonoperating Expenses Cost of Sales from December (Paid in January) Operating Expenses from December (Paid in January) 60% 70% 100% 19,000 21,000 TCA 321-1006 Hospitality Accounting II Homework #3, Fall 2019 Student Name: March Sithabiso's Wraps is an all-organic restaurant located near State University. It is managed by Eunice Ndlovu, and Eunice is preparing her first-quarter cash budget for 2018. It is important to her because of the variation in volume caused by the return of the university students. Help Eunice complete her cash budget in the template provided next. First note the following forecast information and assumptions for Sithabiso's Wraps: Sithabiso's Wraps Cash Budget for the First Quarter of 2018 January February Estimated Cash- Beginning Estimated Cash Receipts: Food Revenues Cash Sales Collection of Account Receivable Dividend Revenue Total Cash Receipts Eunice has budgeted her revenues, cost of sales, and operating expenses based on forecasts for the months of January, February, and March. She expects to collect 80% of revenues in the month they are generated (current month) and the remaining 20% the next month as accounts receivable (AR) based on her aging of accounts receivable. She expects to collect in January $30,000 from accounts receivable from December She expects to pay 60% of the cost of sales in the month they are incurred (current month) and the remaining 40% the next month as accounts payable (AP). She expects to pay in January 19,000 from accounts payable for cost of sales from December She expects to pay 70% of her operating expenses in the month they are incurred (current month) and the remaining 30% the next month as accounts payable (AP). She expects to pay in January 921,000 from accounts payable for operating expenses from December. She expects to pay 100% of her nonoperating expenses in the month they are incurred She has rent expense of $4,000 per month. She pays an insurance premium of $6,000 in the first month of every quarter, and this premium is expensed immediately in the same month. Eunice expects to receive $300 in dividends from a stock investment. She expects to purchase a new range in February and, the cost is expected to be $7,000. Her beginning cash balance in January will be $5,000. Ending cash balance for one month is the beginning cash balance of the next month. She requires a minimum cash balance of $5,000 at all times (i.e. for emergencies). If the budgeted cash available in a given month is below S5,000, Eunice will borrow $5,000 short-term loan in that month from a local bank (no matter what amount the shortage is). This loan will be paid next month along with the 10% monthly interest (i.e. $5,500 will be paid.) Estimated Cash Disbursements: Cost of Sales Cash Payments Payment of Accounts Payable Operating Expenses Cash Payments Payment of Accounts Payable Nonoperating Expenses Rent Payment Insurance Payment Payment for Acquisition of Fixed Assets Total Cash Disbursements Preliminary Balance Minimum Cash Required Cash Excess or Shortage Short-term Borrowing Loan Repayment (including interest) Estimated Cash-Ending Given Data: March Revenues Cost of Sales Operating Expenses Nonoperating Expenses Rent Expense January 60,000 21,000 28,000 February 132,000 46,200 36,000 96,000 33,600 32,000 4,000 4,000 4,000 Insurance Premiums 6,000 Current Month 80% Second Month 20% 30,000 Schedule of Receipts (AR) AR from December (Received in January) Schedule of Payments (AP) Cost of Sales Operating Expenses Nonoperating Expenses Cost of Sales from December (Paid in January) Operating Expenses from December (Paid in January) 60% 70% 100% 19,000 21,000