Required: Prepare a Cash Budget
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.
Required:
Prepare a
![#1 Clearlake Medical Center has the following budgets:
Cash receipts
Cash payments
Inventory purchases
5&A expenses
Jan
$215,000
180,000
62,000
Feb
$242,000
179,000
60,000
Mar
$277,000
195,000
55,000
Clearlake had a cash balance on January 1 of $15,000 and a liability from its line of credit
of $80,000. Funds borrowed have a 1% interest rate per month. Repayments of the loan
and payments to Clearlake's vendors are assumed to be made on last day of the month.
The company desires to maintain a cash cushion of $10,000.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F07d76e1d-a1bb-41d5-b67a-e5d7943d10fd%2F578f4e3a-9412-4c31-aee1-0d78cf5e8843%2Fddhdn88_processed.jpeg&w=3840&q=75)
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