Cash BudgetLeeAnn Ortiz owns a retail store that sells new and used sporting equipment. LeeAnn has requested a cash budget for October. After examining the records of the company, you find the following:Cash balance on October 1 is $1,130.Actual sales for August and September are as follows: August SeptemberCash sales $6,000 $4,500 Credit sales 58,000 62,000 Total sales $64,000 $66,500 Credit sales are collected over a three-month period: 40 percent in the month of sale, 36 percent in the next month, and 22 percent in the second month after the sale. The remaining sales are uncollectible.Inventory purchases average 70 percent of a month's total sales. Of those purchases, 45 percent are paid for in the month of purchase. The remaining 55 percent are paid for in the following month.Salaries and wages total $3,850 per month.Rent is $3,150 per month.Taxes to be paid in October are $1,635.LeeAnn usually withdraws $3,500 each month as her salary.Advertising is $1,500 per month.Other operating expenses total $3,800 per month.Internet and telephone fees are $340 per month.LeeAnn tells you that she expects cash sales of $5,000 and credit sales of $63,000 for October. She likes to have $3,000 on hand at the end of the month and is concerned about the potential October ending balance.Required:Question Content AreaPrepare a cash budget for October. Include supporting schedules for cash collections and cash payments. Round your intermediate computations and final answers to the nearest dollar.Wooster Sporting Goods StoreCash BudgetFor the Month of OctoberBeginning cash balance $fill in the blank 2db29afd7f93fa9_11,130Collections: Cash sales fill in the blank 2db29afd7f93fa9_25,000Credit sales: October fill in the blank 2db29afd7f93fa9_353,740September fill in the blank 2db29afd7f93fa9_466,500August fill in the blank 2db29afd7f93fa9_512,760Total cash available $fill in the blank 2db29afd7f93fa9_666,410Disbursements: Inventory purchases: October $fill in the blank 2db29afd7f93fa9_71,635September fill in the blank 2db29afd7f93fa9_825,217Salaries and wages fill in the blank 2db29afd7f93fa9_93,850Rent fill in the blank 2db29afd7f93fa9_103,150Taxes fill in the blank 2db29afd7f93fa9_111,635Other operating expenses fill in the blank 2db29afd7f93fa9_123,800Owner withdrawal fill in the blank 2db29afd7f93fa9_133,500Advertising fill in the blank 2db29afd7f93fa9_141,500Internet and telephone fill in the blank 2db29afd7f93fa9_15340fill in the blank 2db29afd7f93fa9_1664,707Ending cash balance $fill in the blank 2db29afd7f93fa9_171,703Feedback AreaFeedbackThe cash budget begins with the beginning cash balance. Add all cash receipts. Subtract all cash disbursements. Calculate the ending cash balance.Question Content AreaExplain how each of the four data analytic types—descriptive, diagnostic, predictive, or prescriptive—can be used in LeeAnn's budgeting process. (See Exhibits 2.5 and 2.6, for a review of data analytic types.)The cash budget is used both diagnosticly and predictively to describe what is expected given LeeAnn's assumptions.Feedback AreaFeedbackIncorrectFeedback AreaFeedbackPartially correct thefollowing:a. Cash balance on October 1 is $1,130.b. Actual sales for August and September are as follows:AugustSeptember$6,000$4,50058,00062,000$64,000$66,500Cash salesCredit salesTotal salesc. Credit sales are collected over a three-month period: 40 percent in the month of sale, 36 percent in the next month, and 22 percent in the second month after the sale. Theremaining sales are uncollectible.d. Inventory purchases average 70 percent of a month's total sales. Of those purchases, 45 percent are paid for in the month of purchase. The remaining 55 percent are paid for in thefollowing month.e. Salaries and wages total $3,850 per month.f. Rent is $3,150 per month.g. Taxes to be paid in October are $1,635.h. LeeAnn usually withdraws $3,500 each month as her salary.i. Advertising is $1,500 per month.j. Other operating expenses total $3,800 per month.k. Internet and telephone fees are $340 per month.LeeAnn tells you that she expects cash sales of $5,000 and credit sales of $63,000 for October. She likes to have $3,000 on hand at the end of the month and is concerned about thepotential October ending balance.Required:Prepare a cash budget for October. Include supporting schedules for cash collections and cash payments. Round your intermediate computations and final answers to thenearest dollar.Wooster Sporting Goods StoreCash BudgetFor the Month of OctoberBeginning cash balanceCollections:Cash salesCredit sales:OctoberSeptemberAugustTotal cash availableDisbursements:Inventory purchases:OctoberSeptemberSalaries and wagesRentTaxesOther operating expensesOwner withdrawalAdvertisingInternet and telephoneEnding cash balance1,1305,000 ✓53,740 X66,500 X12,760 ✔1,635 X25,217 X3,8503,1501,6353,8003,500 ✔1,50034066,410 ✓64,707 X1,703 X

Question

Cash BudgetLeeAnn Ortiz owns a retail store that sells new and used sporting equipment. LeeAnn has requested a cash budget for October. After examining the records of the company, you find the following:Cash balance on October 1 is $1,130.Actual sales for August and September are as follows: 	August	 	SeptemberCash sales	 	$6,000    	 	$4,500    Credit sales	 	58,000    	 	62,000        Total sales	 	$64,000    	 	$66,500    Credit sales are collected over a three-month period: 40 percent in the month of sale, 36 percent in the next month, and 22 percent in the second month after the sale. The remaining sales are uncollectible.Inventory purchases average 70 percent of a month's total sales. Of those purchases, 45 percent are paid for in the month of purchase. The remaining 55 percent are paid for in the following month.Salaries and wages total $3,850 per month.Rent is $3,150 per month.Taxes to be paid in October are $1,635.LeeAnn usually withdraws $3,500 each month as her salary.Advertising is $1,500 per month.Other operating expenses total $3,800 per month.Internet and telephone fees are $340 per month.LeeAnn tells you that she expects cash sales of $5,000 and credit sales of $63,000 for October. She likes to have $3,000 on hand at the end of the month and is concerned about the potential October ending balance.Required:Question Content AreaPrepare a cash budget for October. Include supporting schedules for cash collections and cash payments. Round your intermediate computations and final answers to the nearest dollar.Wooster Sporting Goods StoreCash BudgetFor the Month of OctoberBeginning cash balance	$fill in the blank 2db29afd7f93fa9_11,130Collections:		Cash sales	fill in the blank 2db29afd7f93fa9_25,000Credit sales:		October	fill in the blank 2db29afd7f93fa9_353,740September	fill in the blank 2db29afd7f93fa9_466,500August	fill in the blank 2db29afd7f93fa9_512,760Total cash available		$fill in the blank 2db29afd7f93fa9_666,410Disbursements:		Inventory purchases:		October	$fill in the blank 2db29afd7f93fa9_71,635September	fill in the blank 2db29afd7f93fa9_825,217Salaries and wages	fill in the blank 2db29afd7f93fa9_93,850Rent	fill in the blank 2db29afd7f93fa9_103,150Taxes	fill in the blank 2db29afd7f93fa9_111,635Other operating expenses	fill in the blank 2db29afd7f93fa9_123,800Owner withdrawal	fill in the blank 2db29afd7f93fa9_133,500Advertising	fill in the blank 2db29afd7f93fa9_141,500Internet and telephone	fill in the blank 2db29afd7f93fa9_15340fill in the blank 2db29afd7f93fa9_1664,707Ending cash balance		$fill in the blank 2db29afd7f93fa9_171,703Feedback AreaFeedbackThe cash budget begins with the beginning cash balance. Add all cash receipts. Subtract all cash disbursements. Calculate the ending cash balance.Question Content AreaExplain how each of the four data analytic types—descriptive, diagnostic, predictive, or prescriptive—can be used in LeeAnn's budgeting process. (See Exhibits 2.5 and 2.6, for a review of data analytic types.)The cash budget is used both diagnosticly and predictively to describe what is expected given LeeAnn's assumptions.Feedback AreaFeedbackIncorrectFeedback AreaFeedbackPartially correct thefollowing:a. Cash balance on October 1 is $1,130.b. Actual sales for August and September are as follows:AugustSeptember$6,000$4,50058,00062,000$64,000$66,500Cash salesCredit salesTotal salesc. Credit sales are collected over a three-month period: 40 percent in the month of sale, 36 percent in the next month, and 22 percent in the second month after the sale. Theremaining sales are uncollectible.d. Inventory purchases average 70 percent of a month's total sales. Of those purchases, 45 percent are paid for in the month of purchase. The remaining 55 percent are paid for in thefollowing month.e. Salaries and wages total $3,850 per month.f. Rent is $3,150 per month.g. Taxes to be paid in October are $1,635.h. LeeAnn usually withdraws $3,500 each month as her salary.i. Advertising is $1,500 per month.j. Other operating expenses total $3,800 per month.k. Internet and telephone fees are $340 per month.LeeAnn tells you that she expects cash sales of $5,000 and credit sales of $63,000 for October. She likes to have $3,000 on hand at the end of the month and is concerned about thepotential October ending balance.Required:Prepare a cash budget for October. Include supporting schedules for cash collections and cash payments. Round your intermediate computations and final answers to thenearest dollar.Wooster Sporting Goods StoreCash BudgetFor the Month of OctoberBeginning cash balanceCollections:Cash salesCredit sales:OctoberSeptemberAugustTotal cash availableDisbursements:Inventory purchases:OctoberSeptemberSalaries and wagesRentTaxesOther operating expensesOwner withdrawalAdvertisingInternet and telephoneEnding cash balance1,1305,000 ✓53,740 X66,500 X12,760 ✔1,635 X25,217 X3,8503,1501,6353,8003,500 ✔1,50034066,410 ✓64,707 X1,703 X

Accepted Answer

Cash budget is the budget that estimates the cash flow of an entity for a given period. The cash…

Required: Prepare a cash budget for October. Include supporting schedules for cash collections and cash payments. Round your intermediate computations and final answers to the nearest dollar.