WFU Corporation expects to have the sales and expenses shown for August, September,and October. The company expects to receive 55% of collections for sales in the month the sale occurs, 35% in the following month, and the remainder to be uncollectible. The company policy for manufacturing expenses requires that 70% of the expenses be paid in the month incurred and 30% in the following month. All other expenses are paid in the month incurred. The company also earns and collects $5,000 of rental revenue eachmonth. At the end of the quarter, WFU Corporation must make an estimated tax payment, which the company estimates will be 7% of the quarter's total sales. Prepare the cash budget for the three months if cash as of August 1, 2015, totaled $51,500. The company requires a $50,000 minimum cash balance. July $34,000 $39,000 August September October $46,000 $40,000 Sales Manufacturing costs Selling expenses Administrative expenses 15,200 16,800 20,100 19,900 10,000 10,200 14,500 16,500 12,000 12,500 13,000 13,500 Prepare the cash budget for the three months if cash as of August 1, 2015, totaled $51,500. The company requires a $50,000 minimum cash balance.
WFU Corporation expects to have the sales and expenses shown for August, September,and October. The company expects to receive 55% of collections for sales in the month the sale occurs, 35% in the following month, and the remainder to be uncollectible. The company policy for manufacturing expenses requires that 70% of the expenses be paid in the month incurred and 30% in the following month. All other expenses are paid in the month incurred. The company also earns and collects $5,000 of rental revenue eachmonth. At the end of the quarter, WFU Corporation must make an estimated tax payment, which the company estimates will be 7% of the quarter's total sales. Prepare the cash budget for the three months if cash as of August 1, 2015, totaled $51,500. The company requires a $50,000 minimum cash balance. July $34,000 $39,000 August September October $46,000 $40,000 Sales Manufacturing costs Selling expenses Administrative expenses 15,200 16,800 20,100 19,900 10,000 10,200 14,500 16,500 12,000 12,500 13,000 13,500 Prepare the cash budget for the three months if cash as of August 1, 2015, totaled $51,500. The company requires a $50,000 minimum cash balance.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:WFU Corporation expects to have the sales and expenses shown for August, September,and
October. The company expects to receive 55% of collections for sales in the month the sale
occurs, 35% in the following month, and the remainder to be uncollectible. The company
policy for manufacturing expenses requires that 70% of the expenses be paid in the month
incurred and 30% in the following month. All other expenses are paid in the month incurred.
The company also earns and collects $5,000 of rental revenue eachmonth. At the end of the
quarter, WFU Corporation must make an estimated tax payment, which the company
estimates will be 7% of the quarter's total sales. Prepare the cash budget for the three months
if cash as of August 1, 2015, totaled $51,500. The company requires a $50,000 minimum cash
balance.
July
$34,000 $39,000
August September October
$46,000 $40,000
Sales
Manufacturing costs
Selling expenses
Administrative expenses
15,200
16,800
20,100
19,900
10,000
10,200
14,500
16,500
12,000
12,500
13,000
13,500
Prepare the cash budget for the three months if cash as of August 1, 2015, totaled $51,500.
The company requires a $50,000 minimum cash balance.
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