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Yancey has $15,500 in cash on hand on January 1 and has collected the following budget data: E: (Click on the icon to view the
Yancey has $15,500 in cash on hand on January 1 and has collected the following budget data: E: (Click on the icon to view the budget data.) Assume direct labor costs and manufacturing overhead costs are paid in the month incurred. Additionally, assume Yancey has cash payments for selling and administrative expenses including salaries of $40,000 per month plus commissions that are 2% of sales, all paid in the month of sale. The company requires a minimum cash balance of $20,000. Prepare a cash budget for January and February. Round to the nearest dollar. Will Yancey need to borrow cash by the end of February? Begin by preparing the cash budget for January, then prepare the cash budget for February (Complete all input fields. Enter a "0" for any zero balances. Round all amounts entered into the cash budget to the nearest whole dollar.) Yancey Company Cash Budget Two Months Ended January 31 and February 28 January Beginning cash balance Cash receipts Cash available Data Table x Cash payments: Purchases of direct materials Direct labor Manufacturing overhead Selling and administrative expenses Sales Cash receipts from customers Cash payments for direct materials purchases Direct labor costs Manufacturing overhead costs (includes depreciation of $1,900 per month) Total cash payments January February S 525,000 $ 567,000 442,600 502,300 180,732 160,940 134,620 112,876 Ending cash balance before fionancing Minimum cash balance desired 55,248 53,654 Print Done Projected cash excess (deficiency) Financing Borrowing Principal repayments Total effects of financing Ending cash balance February Will Yasmin need to borrow cash by the end of February? Yasmin need to borrow cash by the end of February because the ending cash balance before financing is than the minimum cash balance required
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