Below is budget information for next year for NGG Inc. Quarter 1 Quarter 2 Quarter 3 Quarter 4 Cash inflows - revenues $60,000 $75,000 $70,000 $80,000 Cash outflows - dir matls, dir lab $25,000 $30,000 $27,500 $35,000 Fixed OH expenses $8,000 $8,000 $8,000 $8,000 Distributions to owners $5,000 $5,000 $5,000 $5,000 Equipment purchases (long term) $0 $2,500 $0 $0 No variable overhead is incurred or budgeted.The expected cash balance at the end of the current year is $3,500.Disbursements other than for direct materials and direct labor are expected to occurin the quarter incurred.Fixed overhead expenses include $1,000 for depreciation.What is the budgeted excess or (deficiency) in cash flows at the end of the first quarter?
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.
Below is budget information for next year for NGG Inc.
| Quarter 1 | Quarter 2 |
Quarter 3 |
Quarter 4 | |
| $60,000 | $75,000 | $70,000 | $80,000 | |
| $25,000 | $30,000 | $27,500 | $35,000 | |
| Fixed OH expenses | $8,000 | $8,000 | $8,000 | $8,000 |
| Distributions to owners | $5,000 | $5,000 | $5,000 | $5,000 |
| Equipment purchases (long term) | $0 | $2,500 | $0 | $0 |
No variable overhead is incurred or budgeted.
The expected cash balance at the end of the current year is $3,500.
Disbursements other than for direct materials and direct labor are expected to occur
in the quarter incurred.
Fixed overhead expenses include $1,000 for
What is the budgeted excess or (deficiency) in cash flows at the end of the first quarter?
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