Yosko has $12,500 in cash on hand on January 1 and has collected the following budget data:

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Assume direct labor costs and manufacturing overhead costs are paid in the month incurred. Additionally, assume Yosko has cash payments for selling and administrative expenses including salaries of $55,000 per month plus commissions that

are 2% of sales, all paid in the month of sale. The company requires a minimum cash balance of $5,000. Prepare a cash budget for January and February. Round to the nearest dollar. Will Yosko need to borrow cash by the end of February?

Data table Yosko Company Cash Budget Two Months Ended January 31 and February 28 January Beginning cash balance Cash receipts Cash available Cash payments Purchases of direct materials Direct labor Manufacturing overhead Selling and administrative expenses Total cash payments Ending cash balance before financing Minimum cash balance desired Projected cash excess (deficiency) Financing Borrowing Principal repayments Total effects of financing Ending cash balance Sales Cash receipts from customers Cash payments for direct materials purchases Direct labor costs Manufacturing overhead costs (includes depreciation of $1,900 per month) January February $ 535,000 $ 567,000 442,800 502,900 180.278 160,610 135,130 112,922 55,994 53,452 Print Done