A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires aminimum cash balance of at least $5,000 to start each quarter.Quarter1 2 3 4 YearCash balance, beginning ............................ $ 6 $ ? $ ? $ ? $ ?Add collections from customers ................. ? ? 96 ? 323Total cash available ................................... 71 ? ? ? ?Less disbursements:Purchase of inventory ............................. 35 45 ? 35 ?Operating expenses ................................ ? 30 30 ? 113Equipment purchases ............................. 8 8 10 ? 36Dividends ................................................ 2 2 2 2 ?Total disbursements .................................... ? 85 ? ? ?Excess (defi ciency) of cash availableover disbursements ................................. (2) ? 11 ? ?Financing:Borrowings .............................................. ? 15 — — ?Repayments (including interest)* ............ — — (?) (17) (?)Total fi nancing ............................................ ? ? ? ? ?Cash balance, ending ................................. $ ? $ ? $ ? $ ? $ ?*Interest will total $1,000 for the year.Required:Fill in the missing amounts in the above table
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.
A
minimum cash balance of at least $5,000 to start each quarter.
Quarter
1 2 3 4 Year
Cash balance, beginning ............................ $ 6 $ ? $ ? $ ? $ ?
Add collections from customers ................. ? ? 96 ? 323
Total cash available ................................... 71 ? ? ? ?
Less disbursements:
Purchase of inventory ............................. 35 45 ? 35 ?
Operating expenses ................................ ? 30 30 ? 113
Equipment purchases ............................. 8 8 10 ? 36
Dividends ................................................ 2 2 2 2 ?
Total disbursements .................................... ? 85 ? ? ?
Excess (defi ciency) of cash available
over disbursements ................................. (2) ? 11 ? ?
Financing:
Borrowings .............................................. ? 15 — — ?
Repayments (including interest)* ............ — — (?) (17) (?)
Total fi nancing ............................................ ? ? ? ? ?
Cash balance, ending ................................. $ ? $ ? $ ? $ ? $ ?
*Interest will total $1,000 for the year.
Required:
Fill in the missing amounts in the above table
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