Niagara Corporation’s budgeted monthly sales are $5,000, and they are constant from month to month. Its customers pay as follows: 20% pay in the first month and take the 3% discount, 70% pay in the month following the sale with zero discount and 10% in the third month with 5% interest. The firm has no bad debts. Purchases for next month’s sales are constant at 45% of projected sales for the next month. “Other payments,” which include payments for wages, rent, and taxes, are 18% of sales for the month. Construct a cash budget for a typical month and calculate the average cash gain or loss during the month.(Please show work)
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.
Niagara Corporation’s budgeted monthly sales are $5,000, and they are constant from month to month. Its customers pay as follows: 20% pay in the first month and take the 3% discount, 70% pay in the month following the sale with zero discount and 10% in the third month with 5% interest. The firm has no
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