Exercise 8-7 (Algo) Cash Budget [LO8-8] Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements Beginning cash balance Total cash receipts Total cash available Total cash disbursements Excess (deficiency) of cash available over disbursements Financing: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter $ 350,000 $ 400,000 $ 353,000 $ 393,000 The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded. Borrowings Repayments Interest Required: Prepare the company's cash budget for the upcoming fiscal year. (Repayments, interest, and cash deficiencies should be indicated by a minus sign.) Total financing Ending cash balance $470,000 $363,000 $ X Answer is not complete. Garden Depot Cash Budget 1st Quarter $ 2nd Quarter 10,000 $ 10,000 350,000✔ 470,000✔ 480,000 (363,000) ✔ 117,000 360,000 (393,000) (33,000) 43,000 43,000 10,000 X $ (43,000) X (2,580) X (45,580) 71,420 3rd Quarter $ $420,000 $ 373,000 4th Quarter 71,420 S 400,000✔ 471,420 (353,000) 118,420 0 $ 118,420 118,420 X $ 420,000✔ 538,420 (373,000) 165,420 0 Year 10,000 1,640,000✔ 1,650,000 x (1,482,000)✔ 168,000 X $ 165,420 43,000 X (43,000) X (2,580) X $ 165,420 x
Exercise 8-7 (Algo) Cash Budget [LO8-8] Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements Beginning cash balance Total cash receipts Total cash available Total cash disbursements Excess (deficiency) of cash available over disbursements Financing: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter $ 350,000 $ 400,000 $ 353,000 $ 393,000 The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded. Borrowings Repayments Interest Required: Prepare the company's cash budget for the upcoming fiscal year. (Repayments, interest, and cash deficiencies should be indicated by a minus sign.) Total financing Ending cash balance $470,000 $363,000 $ X Answer is not complete. Garden Depot Cash Budget 1st Quarter $ 2nd Quarter 10,000 $ 10,000 350,000✔ 470,000✔ 480,000 (363,000) ✔ 117,000 360,000 (393,000) (33,000) 43,000 43,000 10,000 X $ (43,000) X (2,580) X (45,580) 71,420 3rd Quarter $ $420,000 $ 373,000 4th Quarter 71,420 S 400,000✔ 471,420 (353,000) 118,420 0 $ 118,420 118,420 X $ 420,000✔ 538,420 (373,000) 165,420 0 Year 10,000 1,640,000✔ 1,650,000 x (1,482,000)✔ 168,000 X $ 165,420 43,000 X (43,000) X (2,580) X $ 165,420 x
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.
Question
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![Exercise 8-7 (Algo) Cash Budget [LO8-8]
Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary
of its budgeted cash flows:
Total cash receipts
Total cash disbursements
The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance
of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any
amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments
are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded.
Beginning cash balance
Total cash receipts
Total cash available
Required:
Prepare the company's cash budget for the upcoming fiscal year. (Repayments, interest, and cash deficiencies should be indicated
by a minus sign.)
Total cash disbursements
Excess (deficiency) of cash available over
disbursements
Financing:
1st Quarter 2nd Quarter 3rd Quarter
$350,000
$ 400,000
$ 470,000
$ 363,000
$ 393,000
$ 353,000
Borrowings
Repayments
Interest
Total financing
Ending cash balance
X Answer is not complete.
$
Garden Depot
Cash Budget
1st Quarter
$
2nd Quarter
10,000 $ 10,000
350,000
470,000
480,000
360,000
(393,000)
(33,000)
43,000 X
43,000
10,000 $
(363,000) ✔
117,000
4th Quarter
$ 420,000
$ 373,000
(43,000) X
(2,580) X
(45,580)
71,420
4th Quarter
71,420 X $
400,000
471,420
(353,000)
118,420
3rd Quarter
$
0
$ 118,420
$
118,420 X $
420,000
538,420
(373,000)
165,420
0
165,420
Year
10,000 X
1,640,000
1,650,000 X
(1,482,000) ✔
168,000 X
S
$
43,000 X
(43,000) X
(2,580) X
165,420 X](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc968ac56-e5fe-4fce-b329-1234b8afb9a8%2F93d9eb72-06dc-48f4-b427-c16d70316caf%2F7gjmfyn_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 8-7 (Algo) Cash Budget [LO8-8]
Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary
of its budgeted cash flows:
Total cash receipts
Total cash disbursements
The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance
of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any
amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments
are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded.
Beginning cash balance
Total cash receipts
Total cash available
Required:
Prepare the company's cash budget for the upcoming fiscal year. (Repayments, interest, and cash deficiencies should be indicated
by a minus sign.)
Total cash disbursements
Excess (deficiency) of cash available over
disbursements
Financing:
1st Quarter 2nd Quarter 3rd Quarter
$350,000
$ 400,000
$ 470,000
$ 363,000
$ 393,000
$ 353,000
Borrowings
Repayments
Interest
Total financing
Ending cash balance
X Answer is not complete.
$
Garden Depot
Cash Budget
1st Quarter
$
2nd Quarter
10,000 $ 10,000
350,000
470,000
480,000
360,000
(393,000)
(33,000)
43,000 X
43,000
10,000 $
(363,000) ✔
117,000
4th Quarter
$ 420,000
$ 373,000
(43,000) X
(2,580) X
(45,580)
71,420
4th Quarter
71,420 X $
400,000
471,420
(353,000)
118,420
3rd Quarter
$
0
$ 118,420
$
118,420 X $
420,000
538,420
(373,000)
165,420
0
165,420
Year
10,000 X
1,640,000
1,650,000 X
(1,482,000) ✔
168,000 X
S
$
43,000 X
(43,000) X
(2,580) X
165,420 X
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