Preparing a cash payments budget (LO 4) Dakota Williams is one of Texas's premiere party planners. She purchases a variety of supplies, such as plastic tableware, stemware, and decorations, throughout the year. Dakota has prepared the following purchases budget for the coming year. 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted purchases $300,000 $420,000 $435,000 $515,000 Historically, Dakota has paid for 40% of her purchases in the quarter of purchase and 60% in the quarter following purchase. On December 31 of this year Dakota had a $250,000 accounts payable balance. Required Prepare Dakota's cash payments budget for the coming year. I don't know how to even start making a budget, my teacher is so confusing. Please help me
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.
Preparing a
|
1st Quarter
|
2nd Quarter
|
3rd Quarter
|
4th Quarter
|
|
| Budgeted purchases |
$300,000
|
$420,000
|
$435,000
|
$515,000
|
Historically, Dakota has paid for 40% of her purchases in the quarter of purchase and 60% in the quarter following purchase. On December 31 of this year Dakota had a $250,000 accounts payable balance.
Required
Prepare Dakota's cash payments budget for the coming year.
I don't know how to even start making a budget, my teacher is so confusing. Please help me
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