Lily Company expects to have a cash balance of $49,500 on January 1, 2022. Relevant monthly budget data for the first 2 months of 2022 are as follows. Collections from customers: January $93,500, February $165,000. Payments for direct materials: January $55,000, February $82,500. Direct labor: January $33,000, February $49,500. Wages are paid in the month they are incurred. Manufacturing overhead: January $23,100, February $27,500. These costs include depreciation of $1,650 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $16,500, February $22,000. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $13,200 in cash. Lily Company has a line of credit at a local bank that enables it to borrow up to $27,500. The company wants to maintain a minimum monthly cash balance of $22,000. Prepare a cash budget for January and February. LILY COMPANY Cash Budget January February

Lily Company expects to have a cash balance of $49,500 on January 1, 2022. Relevant monthly budget data for the first 2 months of 2022 are as follows. Collections from customers: January $93,500, February $165,000. Payments for direct materials: January $55,000, February $82,500. Direct labor: January $33,000, February $49,500. Wages are paid in the month they are incurred. Manufacturing overhead: January $23,100, February $27,500. These costs include depreciation of $1,650 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $16,500, February $22,000. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $13,200 in cash. Lily Company has a line of credit at a local bank that enables it to borrow up to $27,500. The company wants to maintain a minimum monthly cash balance of $22,000. Prepare a cash budget for January and February. LILY COMPANY Cash Budget January February

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please complete the instructional questions (a) and (b) so I can check my work. Thank you. -Mitch
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