The controller of Mercury Shoes Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information: April $150,000 66,000 40,000 Sales/Costs May $175,000 87,000 46,000 June $195,000 115,000 51,000 120,000 Sales Manufacturing costs Selling and admin. expenses Capital expenses The company expects to sell about 15% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month following the sale and the remainder the following month (second month after sale). Depreciation, insurance, and property tax expense represent $12,000 of the estimated monthly manufacturing costs. The annual insurance premium is paid in December, and the annual nronerty taxes are naid in Sentember Of the remainder of the manufacturing costs 80% are
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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On the schedule of collection from sales what are the percentage calculations for cash collected from prior months sales? Note A
Calculations for cash collected and percentages from current months sales Note B
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