Question
The accountant for Vernons Dress Shop prepared the following cash budget. Vernons desires to maintain a cash cushion of $21,000 at the end of each
The accountant for Vernons Dress Shop prepared the following cash budget. Vernons desires to maintain a cash cushion of $21,000 at the end of each month. Funds are assumed to be borrowed and repaid on the last day of each month. Interest is charged at the rate of 1 percent per month.
Required
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Complete the cash budget by filling in the missing amounts.
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Determine the amount of net cash flows from operating activities Vernons will report on the third quarter pro forma statement of cash flows.
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Determine the amount of net cash flows from financing activities Vernons will report on the third quarter pro forma statement of cash flows.
Find surplus and borrowing for Sept
Req A Req B and C Complete the cash budget by filling in the missing amounts. (Any shortages or repayments should be indicated with a minus sign. Round your answers to the nearest whole dollar amount.) Cash Budget July September August Section 1: Cash receipts $51,000 21,000 21,000 Beginning cash balance Add cash receipts 257,600 197,000 217,000 238,000 278,600 248,000 Total cash available Section 2: Cash payments For inventory purchases 182,652 174,026 148,730 For S&A expenses 69,060 63,000 69,932 For interest expense 0 100 109 217,890 252,693 237,026 Total budgeted disbursements Section 3: Financing activities Surplus (shortage) 10,974 20,191 Borrowing (repayments) 10,026 890 21,000 21,000 21,000 Ending cash balanceStep by Step Solution
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