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The controller of Bridgeport Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following
The controller of Bridgeport Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information:Line Item DescriptionSeptemberOctoberNovemberSales$$$Manufacturing costsSelling and administrative expensesCapital expenditures The company expects to sell about of its merchandise for cash. Of sales on account, are expected to be collected in the month following the sale and the remainder the following month second month following sale Depreciation, insurance, and property tax expense represent $ of the estimated monthly manufacturing costs. The annual insurance premium is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, are expected to be paid in the month in which they are incurred and the balance in the following month.Current assets as of September include cash of $ marketable securities of $ and accounts receivable of $$ from July sales and $ from August sales Sales on account for July and August were $ and $ respectively. Current liabilities as of September include $ of accounts payable incurred in August for manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. An estimated income tax payment of $ will be made in October. Bridgeports regular quarterly dividend of $ is expected to be declared in October and paid in November. Management desires to maintain a minimum cash balance of $Required:Question Content Area Prepare a monthly cash budget and supporting schedules for September, October, and November. Assume days per year for interest calculations.Bridgeport Housewares Inc.Cash BudgetFor the Three Months Ending November Line Item DescriptionSeptemberOctoberNovemberEstimated cash receipts from:$Cash sales$Cash sales$Cash salesCollection of accounts receivableCollection of accounts receivableCollection of accounts receivableTotal cash receipts$Total cash receipts$Total cash receipts$Total cash receiptsLess estimated cash payments for:$Manufacturing costs$Manufacturing costs$Manufacturing costsSelling and administrative expensesSelling and administrative expensesSelling and administrative expensesCapital expendituresOther purposes:Income taxDividendsTotal cash payments$Total cash payments$Total cash payments$Total cash payments$Cash increase or decrease$Cash increase or decreaseCash increase or decreasePlus cash balance at beginning of monthPlus cash balance at beginning of monthPlus cash balance at beginning of monthCash balance at end of month$Cash balance at end of month$Cash balance at end of month$Cash balance at end of monthLess minimum cash balanceLess minimum cash balanceLess minimum cash balanceExcess or deficiency$Excess or deficiency$Excess or deficiency$Excess or deficiencyFeedback AreaFeedbackThe primary source of estimated cash receipts is from cash sales and collections on account.To estimate cash receipts from cash sales and collections on account, a schedule of collections from sales is prepared.Question Content Area On the basis of the cash budget prepared in part what recommendation should be made to the controller?The budget indicates that the minimum cash balance fill in the blank of be maintained in November. This situation can be corrected by fill in the blank of andor by the fill in the blank of of the marketable securities if they are held for such purposes. At the end of September and October, the cash balance will fill in the blank of the minimum desired balance.
The controller of Bridgeport Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information:Line Item DescriptionSeptemberOctoberNovemberSales$$$Manufacturing costsSelling and administrative expensesCapital expenditures The company expects to sell about of its merchandise for cash. Of sales on account, are expected to be collected in the month following the sale and the remainder the following month second month following sale Depreciation, insurance, and property tax expense represent $ of the estimated monthly manufacturing costs. The annual insurance premium is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, are expected to be paid in the month in which they are incurred and the balance in the following month.Current assets as of September include cash of $ marketable securities of $ and accounts receivable of $$ from July sales and $ from August sales Sales on account for July and August were $ and $ respectively. Current liabilities as of September include $ of accounts payable incurred in August for manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. An estimated income tax payment of $ will be made in October. Bridgeports regular quarterly dividend of $ is expected to be declared in October and paid in November. Management desires to maintain a minimum cash balance of $Required:Question Content Area Prepare a monthly cash budget and supporting schedules for September, October, and November. Assume days per year for interest calculations.Bridgeport Housewares Inc.Cash BudgetFor the Three Months Ending November Line Item DescriptionSeptemberOctoberNovemberEstimated cash receipts from:$Cash sales$Cash sales$Cash salesCollection of accounts receivableCollection of accounts receivableCollection of accounts receivableTotal cash receipts$Total cash receipts$Total cash receipts$Total cash receiptsLess estimated cash payments for:$Manufacturing costs$Manufacturing costs$Manufacturing costsSelling and administrative expensesSelling and administrative expensesSelling and administrative expensesCapital expendituresOther purposes:Income taxDividendsTotal cash payments$Total cash payments$Total cash payments$Total cash payments$Cash increase or decrease$Cash increase or decreaseCash increase or decreasePlus cash balance at beginning of monthPlus cash balance at beginning of monthPlus cash balance at beginning of monthCash balance at end of month$Cash balance at end of month$Cash balance at end of month$Cash balance at end of monthLess minimum cash balanceLess minimum cash balanceLess minimum cash balanceExcess or deficiency$Excess or deficiency$Excess or deficiency$Excess or deficiencyFeedback AreaFeedbackThe primary source of estimated cash receipts is from cash sales and collections on account.To estimate cash receipts from cash sales and collections on account, a schedule of collections from sales is prepared.Question Content Area On the basis of the cash budget prepared in part what recommendation should be made to the controller?The budget indicates that the minimum cash balance fill in the blank of be maintained in November. This situation can be corrected by fill in the blank of andor by the fill in the blank of of the marketable securities if they are held for such purposes. At the end of September and October, the cash balance will fill in the blank of the minimum desired balance.
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