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The owner of a plumbing supply company has requested a cash budget for June. After examining the records of the company, you find the following:
The owner of a plumbing supply company has requested a cash budget for June. After examining the records of the company, you find the following:
Cash balance on June is $
Actual sales for April and May are as follows:
Line Item Description April May
Cash sales $ $
Credit sales
Total sales $ $
Credit sales are collected over a month period: in the month of sale, in the second month, and in the third month. The sales collected in the third month are subject to a late fee, which is paid by those customers in addition to what they owe. The remaining sales are uncollectible.
Inventory purchases average of a month's total sales. Of those purchases, are paid for in the month of purchase. The remaining are paid for in the following month.
Salaries and wages total $ per month, including a $ salary paid to the owner.
Rent is $ per month.
Taxes to be paid in June are $
The owner also tells you that he expects cash sales of $ and credit sales of $ for June. No minimum cash balance is required. The owner of the company doesn't have access to shortterm loans.
Prepare a cash budget for June. Include supporting schedules for cash collections and cash payments. Round calculations and final answers to the nearest
dollar. Be sure to enter percentages as whole numbers.
Cash Budget
For June
Beginning cash balance
Collections:
Cash sales
Credit sales:
Current month
May credit sales
April credit sales
Total cash available
Less disbursements:
Inventory purchases:
Current month
Prior month
fill in the blank of $
times fill in the blank of
fill in the blank of
Salaries and wages fill in the blank of
Rent fill in the blank of
Taxes fill in the blank of
Total cash needs fill in the blank of
Excess of cash available over needs fill in the blank of $
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