November December January February Month December (2) the expected payments for direct materials purchases. January February $ $ $ $ January V $ V Prepare a cash budget for January and February using columns for each month. $ $ $ LORCH COMPANY Cash Budget For the Two Months Ending February 28, 2023 February Jan Feb Sheffield Company prepares monthly cash budgets. Relevant data from operating budgets for 2023 are as follows: Sales Direct materials purchases Direct labour Manufacturing overhead Selling and administrative expenses Other data are as follows: Month Prepare schedules for (1) the expected collections from customers. January November December January $349,000 All sales are on account. Sheffield expects collections to be 50% in the month of sale, 40% in the first month following the sale, and 10% in the second month following the sale. It pays 30% of direct materials purchases in cash in the month of purchase and the balance due in the month following the purchase. Other data are as follows: 119,000 86,000 1. Credit sales: November 2022, $198,000; December 2022, $282,000 2. Purchases of direct materials: December 2022, $91,000 3. Other receipts: January-collection of December 31, 2022, notes receivable $5,000; February-proceeds from sale of securities $6,000 4. Other disbursements: February-payment of $20,000 for land $ 61,000 74,000 The company expects its cash balance on January 1, 2023, to be $50,000. It wants to maintain a minimum cash balance of $40,000. January February $404,000 111,000 111,000 $ 74,000 80,000 February
November December January February Month December (2) the expected payments for direct materials purchases. January February $ $ $ $ January V $ V Prepare a cash budget for January and February using columns for each month. $ $ $ LORCH COMPANY Cash Budget For the Two Months Ending February 28, 2023 February Jan Feb Sheffield Company prepares monthly cash budgets. Relevant data from operating budgets for 2023 are as follows: Sales Direct materials purchases Direct labour Manufacturing overhead Selling and administrative expenses Other data are as follows: Month Prepare schedules for (1) the expected collections from customers. January November December January $349,000 All sales are on account. Sheffield expects collections to be 50% in the month of sale, 40% in the first month following the sale, and 10% in the second month following the sale. It pays 30% of direct materials purchases in cash in the month of purchase and the balance due in the month following the purchase. Other data are as follows: 119,000 86,000 1. Credit sales: November 2022, $198,000; December 2022, $282,000 2. Purchases of direct materials: December 2022, $91,000 3. Other receipts: January-collection of December 31, 2022, notes receivable $5,000; February-proceeds from sale of securities $6,000 4. Other disbursements: February-payment of $20,000 for land $ 61,000 74,000 The company expects its cash balance on January 1, 2023, to be $50,000. It wants to maintain a minimum cash balance of $40,000. January February $404,000 111,000 111,000 $ 74,000 80,000 February
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
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.
Question
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Transcribed Image Text:November
December
January
February
Month
December
(2) the expected payments for direct materials purchases.
January
February
$
$
$
$
January
V
$
V
Prepare a cash budget for January and February using columns for each month.
$
$
$
LORCH COMPANY
Cash Budget
For the Two Months Ending February 28, 2023
February
Jan
Feb
Transcribed Image Text:Sheffield Company prepares monthly cash budgets. Relevant data from operating budgets for 2023 are as follows:
Sales
Direct materials purchases
Direct labour
Manufacturing overhead
Selling and administrative expenses
Other data are as follows:
Month
Prepare schedules for
(1) the expected collections from customers.
January
November
December
January
$349,000
All sales are on account. Sheffield expects collections to be 50% in the month of sale, 40% in the first month following the sale, and
10% in the second month following the sale. It pays 30% of direct materials purchases in cash in the month of purchase and the
balance due in the month following the purchase.
Other data are as follows:
119,000
86,000
1. Credit sales: November 2022, $198,000; December 2022, $282,000
2. Purchases of direct materials: December 2022, $91,000
3. Other receipts: January-collection of December 31, 2022, notes receivable $5,000; February-proceeds from sale of securities
$6,000
4. Other disbursements: February-payment of $20,000 for land
$
61,000
74,000
The company expects its cash balance on January 1, 2023, to be $50,000. It wants to maintain a minimum cash balance of $40,000.
January
February
$404,000
111,000
111,000
$
74,000
80,000
February
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