Please prepare a cash budget for the Maliwan Co. for the month of April based on the following information: -Estimated cash balance at the end of March was $ 200,000 -April’s depreciation will be $50,000 -Taxes which will be paid in June are $175,000 -April’s payroll will be $90,000 -April’s insurance expense for the month is $40,000 and was prepaid in the month of March. -April’s operating expense are $75,000 -Collections of sales are as follows: 50% in the month of the sale, 30% in the following month, and 20% in the next month. -Receivables balance as of the end of March is as follows $400,000 ( $300,000 relating to March, $100,000 relating to February ). -Sales for the month of April are forecasted to be $900,000 -Merchandise purchases are paid as follows: 50% in the month of the purchase, 30% in the next month, and 20% one month later. -Purchases for March and February were $300,000 and $250,000 respectively and April’s purchases are estimated to be $200,000
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.
1.Please prepare a
-Estimated cash balance at the end of March was $ 200,000
-April’s
-Taxes which will be paid in June are $175,000
-April’s payroll will be $90,000
-April’s insurance expense for the month is $40,000 and was prepaid in the month of March.
-April’s operating expense are $75,000
-Collections of sales are as follows: 50% in the month of the sale, 30% in the following month, and 20% in the next month.
-Receivables balance as of the end of March is as follows $400,000 ( $300,000 relating to March, $100,000 relating to February ).
-Sales for the month of April are
-Merchandise purchases are paid as follows: 50% in the month of the purchase, 30% in the next month, and 20% one month later.
-Purchases for March and February were $300,000 and $250,000 respectively and April’s purchases are estimated to be $200,000
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