Use the following information:Beginning cash balance on March 1, $77,000.Cash receipts from sales, $306,000.Budgeted cash payments for direct materials, $136,000.Budgeted cash payments for direct labor, $71,000.Other budgeted cash expenses, $43,000.Cash repayment of bank loan, $16,000.Prepare a cash budget for the month ended on March 31 for Gado Company. The budget should show expected cash receipts and cash payments for the month of March and the balance expected on March 31.

Cash budget in the business shows all cash receipts and all cash payments that are being made by the…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Use the following information:

Beginning cash balance on March 1, $77,000.
Cash receipts from sales, $306,000.
Budgeted cash payments for direct materials, $136,000.
Budgeted cash payments for direct labor, $71,000.
Other budgeted cash expenses, $43,000.
Cash repayment of bank loan, $16,000.

Prepare a cash budget for the month ended on March 31 for Gado Company. The budget should show expected cash receipts and cash payments for the month of March and the balance expected on March 31.

Definition Definition Estimate of an organization's cash flow for a future period. A cash budget forecasts future cash receipts and payments from various sources for a fiscal year. A cash budget can be created once a month or once a week to determine the organization's cash position and ensure its performance in relation to the budget. It aids in determining whether the company has enough cash and cash equivalents to meet its operational needs in the future.

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