Foyert Corporation requires a minimum $6,800 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid at the end of each month). Any preliminary cash balance above $6,800 is used to repay loans at month-end. The cash balance on October 1 is $6,800, and the company has an outstanding loan of $2,800. Budgeted cash receipts (other than for loans received) and budgeted cash payments (other than for loan or interest payments) follow. Cash receipts Cash payments Beginning cash balance Total cash available October $ 22,800 25,200 Prepare a cash budget for October, November, and December. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) Total cash payments Preliminary cash balance Loan activity Ending cash balance November $ 16,800 15,800 Loan balance - Beginning of month Additional loan (loan repayment) Loan balance-End of month December $ 20,800 15,200 FOYERT CORPORATION Cash Budget October $ Loan balance $ 6,800 0 2,800 November 0 December 0
Foyert Corporation requires a minimum $6,800 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid at the end of each month). Any preliminary cash balance above $6,800 is used to repay loans at month-end. The cash balance on October 1 is $6,800, and the company has an outstanding loan of $2,800. Budgeted cash receipts (other than for loans received) and budgeted cash payments (other than for loan or interest payments) follow. Cash receipts Cash payments Beginning cash balance Total cash available October $ 22,800 25,200 Prepare a cash budget for October, November, and December. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) Total cash payments Preliminary cash balance Loan activity Ending cash balance November $ 16,800 15,800 Loan balance - Beginning of month Additional loan (loan repayment) Loan balance-End of month December $ 20,800 15,200 FOYERT CORPORATION Cash Budget October $ Loan balance $ 6,800 0 2,800 November 0 December 0
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.
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Transcribed Image Text:Foyert Corporation requires a minimum $6,800 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid at
the end of each month). Any preliminary cash balance above $6,800 is used to repay loans at month-end. The cash balance on
October 1 is $6,800, and the company has an outstanding loan of $2,800. Budgeted cash receipts (other than for loans received) and
budgeted cash payments (other than for loan or interest payments) follow.
Cash receipts
Cash payments
Beginning cash balance
October
$ 22,800
25,200
Total cash available
Prepare a cash budget for October, November, and December. (Negative balances and Loan repayment amounts (if any) should be
indicated with minus sign. Round your final answers to the nearest whole dollar.)
November
$ 16,800
15,800
Total cash payments
Preliminary cash balance
Loan activity
Ending cash balance
Loan balance - Beginning of month
Additional loan (loan repayment)
Loan balance - End of month
December
$ 20,800
15,200
FOYERT CORPORATION
Cash Budget
$
October
Loan balance.
$
6,800
0
2,800
November
0
December
0
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