Giving questions, Prepare a cash budget for the January and February for the year 2020 Nadia Company expects to have a cash balance of $44,800 on January 1, 2020. Nadia has budgeted the following for the first twomonths of the year 2020:1.Collections from customers: January $90,900; February $109,300.Payments to suppliers: January $39,900; February $49,500.3.Direct labour: January $29,700; February $35,300. Wages are paid in the month they are incurred.Manufacturing overhead: January $25,000; February $30,200. Overhead costs are paid as incurred.5.Selling and administrative expenses: January $15,900; February $22,000. These costs do not include depreciation and theyare paid as incurred.Sales of investments in January are expected to realize $10,100 in cash. Nadia Company wants to keep a minimum monthlycash balance of $20,000.6.2.4.

The cash budget is prepared to record cash receipts and cash disbursements during the period.

Answered: Nadia Company expects to have a cash…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 34E: A companys sales for the coming months are as follows: About 20 percent of sales are cash sales, and...

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Giving questions, Prepare a cash budget for the January and February for the year 2020

Nadia Company expects to have a cash balance of $44,800 on January 1, 2020. Nadia has budgeted the following for the first two
months of the year 2020:
1.
Collections from customers: January $90,900; February $109,300.
Payments to suppliers: January $39,900; February $49,500.
3.
Direct labour: January $29,700; February $35,300. Wages are paid in the month they are incurred.
Manufacturing overhead: January $25,000; February $30,200. Overhead costs are paid as incurred.
5.
Selling and administrative expenses: January $15,900; February $22,000. These costs do not include depreciation and they
are paid as incurred.
Sales of investments in January are expected to realize $10,100 in cash. Nadia Company wants to keep a minimum monthly
cash balance of $20,000.
6.
2.
4.

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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