Loose Leaf for Fundamentals of Accounting Principles and Connect Access Card
Loose Leaf for Fundamentals of Accounting Principles and Connect Access Card
22nd Edition
ISBN: 9781259542169
Author: John J Wild
Publisher: McGraw-Hill Education
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Cash budget
A cash budget is an estimate of an organization's cash flow for the 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…
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Chapter 22, Problem 2BPSB

Requirement-1:

To determine

To prepare: The Cash receipts Budget for July, August and September

Requirement-1:

Expert Solution
Check Mark

Answer to Problem 2BPSB

Solution: The Cash receipts Budget for July, August and September is as follows:

    July August September
    Budgeted Cash Receipts $ 59,680 $ 66,840 $ 74,200

Explanation of Solution

Explanation: The Cash receipts Budget for July, August and September is prepared as follows:

    Cash Receipts July August September
    Budgeted Sales (A)
    		 $ 63,400
    		$ 80,600
    		$ 48,600
    Cash Sales (B) = (A*20%)
    		 $ 12,680
    		$ 16,120
    		$ 9,720
    Credit Sales (C) = (A*80%)
    		 $ 50,720
    		$ 64,480
    		$ 38,880
    Collection of Sales:


    Cash Sales (in the same month)
    		 $ 12,680
    		$ 16,120
    		$ 9,720
    Credit Sales (in the next month)
    		 $ 47,000
    		$ 50,720
    		$ 64,480
    Budgeted Cash Receipts $ 59,680 $ 66,840 $ 74,200

Conclusion
The Cash receipts Budget for July, August and September is as follows:

    July August September
    Budgeted Cash Receipts $ 59,680 $ 66,840 $ 74,200

Requirement-2:

To determine

To prepare: The Cash Budget for July, August and September

Requirement-2:

Expert Solution
Check Mark

Answer to Problem 2BPSB

Solution: The Cash Budget for July, August and September is as follows:

    Cash Budget:July August September
    Beginning Cash Balance $ 12,900 $ 12,600 $ 24,371
    Budgeted Cash Receipts
    		$ 59,680
    		$ 66,840
    		$ 74,200
    Budgeted Cash payments:



    Direct Material
    		$ 12,480
    		$ 9,900
    		$ 10,140
    Direct Labor
    		$ 10,400
    		$ 8,250
    		$ 8,450
    Factory Overhead
    		$ 18,720
    		$ 14,850
    		$ 15,210
    Sales Commission
    		$ 6,340
    		$ 8,060
    		$ 4,860
    Office Salaries
    		$ 4,600
    		$ 4,600
    		$ 4,600
    Rent
    		$ 7,100
    		$ 7,100
    		$ 7,100
    Interest on loan
    		$ 26
    		$ 23
    		$ -
    Total Budgeted Cash Payments
    		$ 59,666
    		$ 52,783
    		$ 50,360
    Cash Surplus/(Deficit) $ 12,914 $ 26,657 $ 48,211




    Beginning Loan balance
    		$ 2,600
    		$ 2,286
    		$ -
    Loan Taken

    		 $ -

    Loan Paid
    		$ 314
    		$ 2,286

    Ending Loan balance
    		$ 2,286
    		$ -
    		$ -




    Ending Cash balance $ 12,600 $ 24,371 $ 48,211

Explanation of Solution

Explanation: The Cash Budget for July, August and September is prepared as follows:

    Cash Budget:July August September
    Beginning Cash Balance (A)$ 12,900 $ 12,600 $ 24,371
    Budgeted Cash Receipts (B)
    		 $ 59,680
    		$ 66,840
    		$ 74,200
    Budgeted Cash payments:



    Direct Material
    		$ 12,480
    		$ 9,900
    		$ 10,140
    Direct Labor
    		$ 10,400
    		$ 8,250
    		$ 8,450
    Factory Overhead
    		$ 18,720
    		$ 14,850
    		$ 15,210
    Sales Commission (10% of sales)
    		$ 6,340
    		$ 8,060
    		$ 4,860
    Office Salaries
    		$ 4,600
    		$ 4,600
    		$ 4,600
    Rent
    		$ 7,100
    		$ 7,100
    		$ 7,100
    Interest on loan (1% of beginning loan balance)
    		 $ 26
    		$ 23
    		$ -
    Total Budgeted Cash Payments (C)
    		 $ 59,666
    		$ 52,783
    		$ 50,360
    Cash Surplus/(Deficit) (D) =A+B-C =$ 12,914 $ 26,657 $ 48,211




    Beginning Loan balance
    		$ 2,600
    		$ 2,286
    		$ -
    Loan Taken (E)

    		 $ -

    Loan Paid (F)
    		 $ 314
    		$ 2,286

    Ending Loan balance
    		$ 2,286
    		$ -
    		$ -




    Ending Cash balance = D+E-F=$ 12,600 $ 24,371 $ 48,211

Conclusion

Conclusion: The Cash Budget for July, August and September is prepared using all the budgets information.

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Chapter 22 Solutions

Loose Leaf for Fundamentals of Accounting Principles and Connect Access Card

Ch. 22 - Prob. 1DQCh. 22 - Prob. 2DQCh. 22 - Prob. 3DQCh. 22 - Prob. 4DQCh. 22 - Prob. 5DQCh. 22 - Prob. 6DQCh. 22 - Prob. 7DQCh. 22 - Prob. 8DQCh. 22 - Prob. 9DQCh. 22 - Prob. 10DQ
Ch. 22 - Apple regularly uses budgets. What is the...Ch. 22 - Prob. 12DQCh. 22 - Prob. 13DQCh. 22 - Prob. 14DQCh. 22 - Prob. 1QSCh. 22 - Budgeting process C1 Good management includes good...Ch. 22 - Components of a master budget C2 Identify which of...Ch. 22 - Prob. 4QSCh. 22 - Prob. 5QSCh. 22 - Prob. 6QSCh. 22 - Prob. 7QSCh. 22 - Prob. 8QSCh. 22 - Prob. 9QSCh. 22 - Prob. 10QSCh. 22 - Prob. 11QSCh. 22 - Prob. 12QSCh. 22 - Prob. 13QSCh. 22 - Prob. 14QSCh. 22 - Prob. 15QSCh. 22 - Prob. 16QSCh. 22 - Prob. 17QSCh. 22 - Prob. 18QSCh. 22 - Prob. 19QSCh. 22 - Prob. 20QSCh. 22 - Prob. 21QSCh. 22 - Prob. 22QSCh. 22 - Prob. 23QSCh. 22 - Prob. 24QSCh. 22 - Prob. 25QSCh. 22 - Prob. 26QSCh. 22 - Prob. 27QSCh. 22 - Prob. 28QSCh. 22 - Prob. 29QSCh. 22 - Prob. 30QSCh. 22 - Activity-based budgeting Activity-based budgeting...Ch. 22 - Prob. 32QSCh. 22 - Exercise 22-1 Budget consequences C1 Participatory...Ch. 22 - Exercise 22-2 Master budget definitions C2 Match...Ch. 22 - Prob. 3ECh. 22 - Prob. 4ECh. 22 - Prob. 5ECh. 22 - Prob. 6ECh. 22 - Prob. 7ECh. 22 - Prob. 8ECh. 22 - Prob. 9ECh. 22 - Prob. 10ECh. 22 - Prob. 11ECh. 22 - Prob. 12ECh. 22 - Prob. 13ECh. 22 - Prob. 14ECh. 22 - Prob. 15ECh. 22 - Prob. 16ECh. 22 - Prob. 17ECh. 22 - Prob. 18ECh. 22 - Prob. 19ECh. 22 - Prob. 20ECh. 22 - Prob. 21ECh. 22 - Prob. 22ECh. 22 - Prob. 23ECh. 22 - Prob. 24ECh. 22 - Prob. 25ECh. 22 - Prob. 26ECh. 22 - Prob. 27ECh. 22 - Prob. 28ECh. 22 - Prob. 29ECh. 22 - Prob. 30ECh. 22 - Prob. 31ECh. 22 - Prob. 32ECh. 22 - Prob. 33ECh. 22 - Exercise 22-35 Activity-based budgeting A1 Render...Ch. 22 - Prob. 1APSACh. 22 - Prob. 2APSACh. 22 - Prob. 3APSACh. 22 - Prob. 4APSACh. 22 - Prob. 5APSACh. 22 - Prob. 6APSACh. 22 - Prob. 7APSACh. 22 - Prob. 8APSACh. 22 - Problem 22-1B Manufacturing: Preparing production...Ch. 22 - Prob. 2BPSBCh. 22 - Prob. 3BPSBCh. 22 - Prob. 4BPSBCh. 22 - Prob. 5BPSBCh. 22 - Prob. 6BPSBCh. 22 - Prob. 7BPSBCh. 22 - Prob. 8BPSBCh. 22 - Prob. 22SPCh. 22 - Prob. 1BTNCh. 22 - Prob. 2BTNCh. 22 - Both the budget process and budgets themselves can...Ch. 22 - The sales budget is usually the first and most...Ch. 22 - Prob. 5BTNCh. 22 - Prob. 6BTNCh. 22 - Prob. 7BTNCh. 22 - To help understand the factors impacting a sales...Ch. 22 - Prob. 9BTN
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