Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead July August September $ 63,500 $ 79,500 $ 48,500 16,260 13,540 13,860 4,140 20,300 3,460 16,900 3,540 17,300 Sales to customers are 25% cash and 75% on credit. Sales in June were $57,000. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $17,000 in cash and $5,100 in loans payable. A minimum cash balance of $17,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $17,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $17,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($4,100 per month), and rent ($6,600 per month). 2. Prepare a cash budget for the months of July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Enter your final answers in whole dollars.) Beginning cash balance Total cash available Less: Cash payments for Total cash payments Preliminary cash balance Loan activity Additional loan Repayment of loan to bank Ending cash balance Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month BUILT-TIGHT Cash Budget July August September 0 0 0 0 0 0 Loan balance July August September
Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead July August September $ 63,500 $ 79,500 $ 48,500 16,260 13,540 13,860 4,140 20,300 3,460 16,900 3,540 17,300 Sales to customers are 25% cash and 75% on credit. Sales in June were $57,000. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $17,000 in cash and $5,100 in loans payable. A minimum cash balance of $17,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $17,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $17,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($4,100 per month), and rent ($6,600 per month). 2. Prepare a cash budget for the months of July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Enter your final answers in whole dollars.) Beginning cash balance Total cash available Less: Cash payments for Total cash payments Preliminary cash balance Loan activity Additional loan Repayment of loan to bank Ending cash balance Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month BUILT-TIGHT Cash Budget July August September 0 0 0 0 0 0 Loan balance July August September
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Budgeted sales
Budgeted cash payments for
Direct materials
Direct labor
Overhead
July
August
September
$ 63,500
$ 79,500
$ 48,500
16,260
13,540
13,860
4,140
20,300
3,460
16,900
3,540
17,300
Sales to customers are 25% cash and 75% on credit. Sales in June were $57,000. All credit sales are collected in the
month following the sale. The June 30 balance sheet includes balances of $17,000 in cash and $5,100 in loans payable. A
minimum cash balance of $17,000 is required. Loans are obtained at the end of any month when the preliminary cash
balance is below $17,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each
month-end. Any preliminary cash balance above $17,000 is used to repay loans at month-end. Expenses are paid in the
month incurred and consist of sales commissions (10% of sales), office salaries ($4,100 per month), and rent ($6,600 per
month).
2. Prepare a cash budget for the months of July, August, and September. (Negative balances and Loan repayment amounts (if any)
should be indicated with minus sign. Enter your final answers in whole dollars.)
Beginning cash balance
Total cash available
Less: Cash payments for
Total cash payments
Preliminary cash balance
Loan activity
Additional loan
Repayment of loan to bank
Ending cash balance
Loan balance - Beginning of month
Additional loan (loan repayment)
Loan balance - End of month
BUILT-TIGHT
Cash Budget
July
August
September
0
0
0
0
0
0
Loan balance
July
August
September
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