Cash budget-Basic Grenoble Enterprises had sales of $49,700 in March and $60,000 in April Forecast sales for May, June, and July are $70,300, $80, 100, and $100,500, respectively The firm has a cash balance of $4,900 on May 1 and wishes to maintain a minimum cash balance of $4,900 Given the following data, prepare and interpret a cash budget for the months of May, June, and July (1) The firm makes 22% of sales for cash, 55% are collected in the next month, and the remaining 23% are collected in the second month following sale. (2) The firm receives other income of $1,700 per month (3) The firm's actual or expected purchases, all made for cash, are $50,200, $70,200, and $80,500 for the months of May through July, respectively (4) Rent is $3,000 per month (5) Wages and salaries are 9% of the previous month's sales. (6) Cash dividends of $3,100 will be paid in June (7) Payment of principal and interest of $3,500 is due in June (8) A cash purchase of equipment costing $5,600 is scheduled in July (9) Taxes of $5,900 are due in June vyp Net cash flow Add Beginning cash Ending cash S S Taxes due Total cash disbursements (Round to the nearest dollar. Please input all the values in the table before checking your answers) April May Minimum cash Required total financing (notes payable) Excess cash balance (marketable securities) (5.900) (92,027) S $ S S S June 4,900 4:900 I
Cash budget-Basic Grenoble Enterprises had sales of $49,700 in March and $60,000 in April Forecast sales for May, June, and July are $70,300, $80, 100, and $100,500, respectively The firm has a cash balance of $4,900 on May 1 and wishes to maintain a minimum cash balance of $4,900 Given the following data, prepare and interpret a cash budget for the months of May, June, and July (1) The firm makes 22% of sales for cash, 55% are collected in the next month, and the remaining 23% are collected in the second month following sale. (2) The firm receives other income of $1,700 per month (3) The firm's actual or expected purchases, all made for cash, are $50,200, $70,200, and $80,500 for the months of May through July, respectively (4) Rent is $3,000 per month (5) Wages and salaries are 9% of the previous month's sales. (6) Cash dividends of $3,100 will be paid in June (7) Payment of principal and interest of $3,500 is due in June (8) A cash purchase of equipment costing $5,600 is scheduled in July (9) Taxes of $5,900 are due in June vyp Net cash flow Add Beginning cash Ending cash S S Taxes due Total cash disbursements (Round to the nearest dollar. Please input all the values in the table before checking your answers) April May Minimum cash Required total financing (notes payable) Excess cash balance (marketable securities) (5.900) (92,027) S $ S S S June 4,900 4:900 I
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
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
Transcribed Image Text:Cash budget-Basic Grenoble Enterprises had sales of $49,700 in March and $60,000 in April. Forecast sales for May, June, and July are $70,300, $80,100, and $100,500, respectively The firm has a cash
balance of $4,900 on May 1 and wishes to maintain a minimum cash balance of $4,900 Given the following data, prepare and interpret a cash budget for the months of May, June, and July
(1) The firm makes 22% of sales for cash, 55% are collected in the next month, and the remaining 23% are collected in the second month following sale
(2) The firm receives other income of $1,700 per month.
(3) The firm's actual or expected purchases, all made for cash, are $50,200, $70,200, and $80,500 for the months of May through July, respectively
(4) Rent is $3,000 per month.
(5) Wages and salaries are 9% of the previous month's sales
(6) Cash dividends of $3,100 will be paid in June
(7) Payment of principal and interest of $3,500 is due in June
(8) A cash purchase of equipment costing $5,600 is scheduled in July
(9) Taxes of $5,900 are due in June
vir vypom
Taxes due
Total cash disbursements
(Round to the nearest dollar. Please input all the values in the table before checking your answers.)
Net cash flow
Add Beginning cash
Ending cash
Minimum cash
Required total financing (notes payable)
Excess cash balance (marketable securities)
April
May
S
(5.900)
(92,027)
$
$
S
S
$
S
June
4,900
4.900
I
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education