Please help me ### Cash Budget Calculation Exercise**Problem Statement:**Bailey manufactures dolls and estimates sales of $120,000 for November, $100,000 for December, and $150,000 for January. Each doll sells for $20 and the cost to make each one is $10. Historically, 50% of sales will be collected in the month of sale and the remaining 50% the following month, and this pattern is expected to continue. The beginning cash balance for November is $20,000 and beginning Accounts Receivable was $45,000. Beginning inventory in November is 2,000 dolls, and Bailey wants to maintain at least 20% of the next month's sale for ending inventory. Fixed costs each month are $10,000. Production and fixed costs are all paid when incurred.**Question:**What is the estimated cash ending balance for November?**Options:**- $25,000- $70,000- $80,000- $65,000**Solution Approach:**1. **Sales Collection:** - November sales: $120,000 - Collection in November: 50% of $120,000 = $60,000 - Collection from October (as receivables): $45,000 Total cash collection in November: $60,000 + $45,000 = $105,0002. **Production Costs:** - Cost per doll: $10 - Sales for December: $100,000 - Ending inventory required: 20% of 5,000 units (December sales) = 1,000 units Total production required in November: - Sales units for November: $120,000 / $20 = 6,000 units - Ending inventory: 1,000 units - Beginning inventory: 2,000 units Units to produce = (6,000 + 1,000 - 2,000) = 5,000 units Production cost: 5,000 units x $10 = $50,000 3. **Fixed Costs:** - Fixed costs in November: $10,0004. **Cash Budget:** - Beginning cash balance: $20,000 - Cash Collections: $105,000 - Cash Outflows: - Production costs: $50,000

Cash budget is one of the important form of budget being prepared in business. This shows all cash…

Bailey manufactures dolls and estimates sales of $120,000 for November, $100,000 for December, and $150,000 for January. Each doll sells for $20 and the cost to make each one is $10. Historically 50% of sales will be collected in the month of sale and the remaining 50% the following month and this pattern is expected to continue. The beginning cash balance for November is $20,000 and beginning Accounts Receivable was $45,000. Beginning inventory in November is 2,000 dolls and Bailey want to maintain at least 20% of the next month's sale for ending inventory. Fixed costs each month is $10,000. Production and fixed costs are all paid when incurred. What is the estimated cash ending balance for November? O $25,000 O $70,000 O $80,000 O $65,000

Bailey manufactures dolls and estimates sales of $120,000 for November, $100,000 for December, and $150,000 for January. Each doll sells for $20 and the cost to make each one is $10. Historically 50% of sales will be collected in the month of sale and the remaining 50% the following month and this pattern is expected to continue. The beginning cash balance for November is $20,000 and beginning Accounts Receivable was $45,000. Beginning inventory in November is 2,000 dolls and Bailey want to maintain at least 20% of the next month's sale for ending inventory. Fixed costs each month is $10,000. Production and fixed costs are all paid when incurred. What is the estimated cash ending balance for November? O $25,000 O $70,000 O $80,000 O $65,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Im having an issue with this problem. Thank you!
PLEASE HELP ASAP!
please solve those problems
Please send me answer as soon as possible
I need help solving for r.
Goodwill messages craft special messages that foster goodwill and convey kindness. One page answer
I NEED HELP ! PLEASEEE
How do you find yeild to call?