Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
15th Edition
ISBN: 9780134476315
Author: Chad J. Zutter, Scott B. Smart
Publisher: PEARSON
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Textbook Question
Chapter 4, Problem 4.9P
Learning Goal 4
P4-9 Cash disbursements schedule Maris Brothers Inc. needs a cash disbursement schedule for the months of April, May, and June. Use the format of Table 4.9 and the following information in its preparation.
Sales: February = $500,000; March = $500,000; April = $560,000;
May = $610,000; June = $650,000; July = $650,000
Purchases: Purchases are calculated as 60% of the next month's sales, 10% of purchases are made in cash, 50% of purchases are paid for 1 month after purchase, and the remaining 40% of purchases are paid for 2 months after purchase.
Rent: The firm pays rent of $8,000 per month.
Wages and salaries: Base wage and salary costs are fixed at $6,000 per month plus a variable cost of 7% of the current month’s sales.
Taxes: A tax payment of $54,500 is due in June.
Fixed asset outlays: New equipment costing $75,000 will be bought and paid for in April.
Interest payments: An interest payment of$30,000 is due in June.
Cash dividends: Dividends of $12,500 will be paid in April.
Principal repayments and retirements: No principal repayments or retirements are due during these months.
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Cash disbursements schedule Maris Brothers, Inc., needs a cash disbursement schedule for the months of April, May, and June. Use the format given here and the following information in its preparation.
Sales: February $493,000; March $517,000; April $539,000; May $627,000; June $660,000; July $651,000
Purchases: Purchases are calculated as 65% of the next month's sales, 12% of purchases are made in cash, 55% of purchases are paid for 1 month after purchase, and the remaining 33% of purchases are paid for 2 months after purchase.
Rent: The firm pays rent of $8,020 per month.
Wages and salaries: Base wage and salary costs are fixed at $5,700 per month plus a variable cost of 7.3% of the current month's sales.
Taxes: A tax payment of $54,700 is due in June.
Fixed asset outlays: New equipment costing $74,900 will be bought and paid for in April.
Interest payments: An interest payment of $30,100 is due in June.
Cash dividends: Dividends of $13,000 will be paid in April.
Principal repayments…
Question 2: Avril Company makes collections on sales according to the below
schedule. The Treasury Manager conducts an analysis of the cash collection and
determines that cash collection target for March should be $150,000. Evaluate whether
the collection target for March is correct and summarize your recommendations.
Month
Expected Sales
January
$ 100,000
February
$ 120,000
March
$ 110,000
30% in the month of sale
60% in the month following sale
10% in the second month following sale
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Cash Budget
The controller of Sonoma Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information:
May
June
July
Sales
$146,000 $185,000 $248,000
Manufacturing costs
61,000
80,000
89,000
Selling and administrative expenses
42,000
50,000
55,000
Capital expenditures
60,000
The company expects to sell about 10% of its merchandise for cash. Of sales on account, 60% are expected to be collected in the month following the sale and the remainder the following month (second
month following sale). Depreciation, insurance, and property tax expense represent $7,000 of the estimated monthly manufacturing costs. The annual insurance premium is paid in September, and the annual
property taxes are paid in November. Of the remainder of the manufacturing costs, 85% are expected to be…
Chapter 4 Solutions
Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
Ch. 4.1 - Prob. 4.1RQCh. 4.1 - Prob. 4.2RQCh. 4.2 - Briefly describe the first four modified...Ch. 4.2 - Describe the overall cash flow through the firm in...Ch. 4.2 - Prob. 4.5RQCh. 4.2 - 4-B Why is depreciation (as well as amortization...Ch. 4.2 - Prob. 4.7RQCh. 4.2 - Prob. 4.8RQCh. 4.2 - Prob. 4.9RQCh. 4.3 - Prob. 4.10RQ
Ch. 4.3 - Prob. 4.11RQCh. 4.3 - Prob. 4.12RQCh. 4.3 - What is the cause of uncertainty in the cash...Ch. 4.4 - Prob. 4.14RQCh. 4.5 - Prob. 4.15RQCh. 4.5 - Prob. 4.16RQCh. 4.6 - Prob. 4.17RQCh. 4.6 - What is the significance of the plug figure,...Ch. 4.7 - Prob. 4.19RQCh. 4.7 - Prob. 4.20RQCh. 4 - Opener-in-Review The chapter opener described a...Ch. 4 - Learning Goals 2, 3 ST4-1 Depreciation and cash...Ch. 4 - Prob. 4.2STPCh. 4 - Prob. 4.3STPCh. 4 - Prob. 4.1WUECh. 4 - Prob. 4.2WUECh. 4 - Learning Goal 3 E4-3 Determine the operating cash...Ch. 4 - Prob. 4.4WUECh. 4 - Learning Goal 5 E4-5 Rimier Corp. forecasts sales...Ch. 4 - Prob. 4.1PCh. 4 - Learning Goal 2 P4-2 Depreciation In early 2019,...Ch. 4 - Prob. 4.3PCh. 4 - Learning Goals 2, 3 P4-4 Depreciation and...Ch. 4 - Learning Goal 3 P4-5 Classifying inflows and...Ch. 4 - Prob. 4.6PCh. 4 - Learning Goal 4 P4-8 Cash receipts A firm has...Ch. 4 - Learning Goal 4 P4-9 Cash disbursements schedule...Ch. 4 - Learning Goal 4 P4-10 Cash budget: Basic Grenoble...Ch. 4 - Prob. 4.11PCh. 4 - Learning Goal 4 P4-12 Cash budget: Advanced The...Ch. 4 - Prob. 4.13PCh. 4 - Prob. 4.14PCh. 4 - Learning Goal 4 P4-15 Multiple cash budgets:...Ch. 4 - Learning Goal 5 P4-16 Pro forma income statement...Ch. 4 - Learning Goal 5 P4-17 Pro forma income statement:...Ch. 4 - Learning Goal 5 P4-18 Pro forma balance sheet:...Ch. 4 - Learning Goal 5 P4-19 Pro forma balance sheet...Ch. 4 - Learning Goal 5 P4-20 Integrative: Pro forma...Ch. 4 - Learning Goal 5 P4-21 Integrative: Pro forma...Ch. 4 - Prob. 4.22PCh. 4 - Prob. 1SE
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