A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires a minimum cash balanc $4,000 to start each quarter. Required: Fill in the missing amounts. Note: Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign Cash balance, beginning Add collections from customers Total cash available Less disbursements: Purchase of inventory Selling and administrative expenses Equipment purchases Dividends Total disbursements Excess (deficiency) of cash available over disbursements Financing: Borrowings Repayments (including interest) * Total financing $ 1 7 82 89 48 11 2 (2) Quarter (000 omitted) 2 3 58 45 9 2 114 18 109 30 23 2 7 4 32 2 (22) (000 omitted) Year $ 7 392 127 53 8
A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires a minimum cash balanc $4,000 to start each quarter. Required: Fill in the missing amounts. Note: Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign Cash balance, beginning Add collections from customers Total cash available Less disbursements: Purchase of inventory Selling and administrative expenses Equipment purchases Dividends Total disbursements Excess (deficiency) of cash available over disbursements Financing: Borrowings Repayments (including interest) * Total financing $ 1 7 82 89 48 11 2 (2) Quarter (000 omitted) 2 3 58 45 9 2 114 18 109 30 23 2 7 4 32 2 (22) (000 omitted) Year $ 7 392 127 53 8
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:**Educational Resource on Cash Budgeting for a Retail Company**
This table illustrates a cash budget divided by quarters for a retail company (in thousands of dollars, with three zeros omitted). The company mandates a minimum cash balance of $4,000 at the start of each quarter.
### Required Task:
Fill in the missing amounts.
**Note:** Enter your answers in thousands of dollars. Cash deficiencies and repayments should be indicated by a minus sign.
#### Quarterly Cash Budget Breakdown:
| | Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | Year |
|------------------------------|-----------|-----------|-----------|-----------|-------|
| **Cash balance, beginning** | $7 | | | $7 | $7 |
| **Add collections from customers** | 82 | | 109 | | 392 |
| **Total cash available** | 89 | | | | |
| **Less disbursements:** | | | | | |
| Purchase of inventory | 48 | 58 | | 32 | |
| Selling and administrative expenses | | 45 | 30 | | 127 |
| Equipment purchases | 11 | 9 | 23 | | 53 |
| Dividends | 2 | 2 | 2 | 2 | 8 |
| **Total disbursements** | | 114 | | | |
| **Excess (deficiency) of cash available over disbursements** | (2) | | 7 | | |
| **Financing:** | | | | | |
| Borrowings | | 18 | | | |
| Repayments (including interest) * | | | | (22) | |
| **Total financing** | | | | | |
| **Cash balance, ending** | | | | | |
*Interest will total $1,000 for the year.
---
This table serves as an educational tool for understanding how to manage and evaluate a company's cash budget over a fiscal year, divided into quarters
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