On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the ompany's sales are made on account The following information has been provided by Spicer's management Month Credit Sales $ 300,000 (actual) 400,000 (actual) 557,000 (estimated) 669,000 (estimated) 800,000 (estimated) January February March April May he company's collection activity on credit sales historically has been as follows. Collections in the month of the sale Collections one month after the sale Collections two months after the sale 50% 30 15 Uncollectible accounts Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400,000 per month). Its ash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarte Compute Spicer's budgeted cash balance at the ends of March, April, and May. Cash balance on March 31 Cash balance on April 30 Cash balance on May 31 Next > 2 of 3
On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the ompany's sales are made on account The following information has been provided by Spicer's management Month Credit Sales $ 300,000 (actual) 400,000 (actual) 557,000 (estimated) 669,000 (estimated) 800,000 (estimated) January February March April May he company's collection activity on credit sales historically has been as follows. Collections in the month of the sale Collections one month after the sale Collections two months after the sale 50% 30 15 Uncollectible accounts Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400,000 per month). Its ash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarte Compute Spicer's budgeted cash balance at the ends of March, April, and May. Cash balance on March 31 Cash balance on April 30 Cash balance on May 31 Next > 2 of 3
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Budgeting help
Transcribed Image Text:LO23-5)
On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the
company's sales are made on account The following information has been provided by Spicer's management.
Month
Credit Sales
January
February
March
$ 300,000 (actual)
400,000 (actual)
557,000 (estimated)
669,000 (estimated)
800,000 (estimated)
April
May
The company's collection activity on credit sales historically has been as follows.
50%
Collections in the month of the sale
30
Collections one month after the sale
15
Collections two months after the sale
Uncollectible accounts
Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400,000 per month). Its
cash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarter.
Compute Spicer's budgeted cash balance at the ends of March, April, and May.
Cash balance on March 31
Cash balance on April 30
Cash balance on May 31
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