Chapter 9, Problem 9.15E

Deitz Corporation is projecting a cash balance of $30,000 in its December 31,2016. balance sheet. Deitz’s schedule of expected collections from customers for the first quarter of 2017 shows total collections of $185,000. The schedule of expected payments for direct materials for the first quarter of 2017 shows total payments of $43,000. Other information gathered for the first quarter of 2017 is sale of equipment $3,000, direct labor $70,000, manufacturing overhead $35,000. selling and administrative expenses $45,000, and purchase of securities $14,000. Deitz wants to maintain a balance of at least $25,000 cash at the end of each quarter.

Instructions

Prepare a cash budget for the first quarter.