Are You Seeking For Superior Cash Budget Assignment Help At Cheap? Connect With Expertsminds Highly Qualified Tutor!

Home   Course   Cash Budget Assignment Help
Previous << || >> Next

Cash Budget Assignment

EXPERTSMINDS.COM ACCEPTS INSTANT AND SHORT DEADLINES ORDER FOR CASH BUDGET ASSIGNMENT - ORDER TODAY FOR EXCELLENCE!

You are a Consultant for the professional service firm, BUSI 2083 LLP. Your firm specializes in providing a wide variety of internal business solutions for different clients. One of the partners in your practice is impressed with the work you have completed to date and would like to give you additional responsibility. She has asked you to take the lead on this engagement with the hope that a successful outcome may lead to your promotion to Senior Consultant. You take the background files from the partner and get started.

Perfect Stitch Replica's Limited, a nationwide distributor of low-cost imitation clothing, has an exclusive agreement for the distribution of the clothing. Sales have grown so rapidly over the last few years that it has become necessary to add new members to the management team. To date, the company's budgeting practices have been minimal, and at times, the company has experienced a cash shortage. You have been given responsibility for all planning and budgeting.

Question 1: Prepare a master budget for the next three months, starting April 1.

Solution: Introduction

A master budget is to be prepared for the next three months starting from April 1 for Perfect Stitch Replica's Limited. The master budget includes preparation of sub-budgets including sales budget, material purchase budget, and other expenses budgets. There is a need to prepare cash budget as a master budget for the first quarter starting April and ending June for three months with the budgeted income statement and the budgeted balance sheet.

NEVER LOSE YOUR CHANCE TO EXCEL IN CASH BUDGET ASSIGNMENT - HIRE BEST QUALITY TUTOR FOR ASSIGNMENT HELP!

Sale Budget

Sales Budget

April

May

June

Total

Sale Revenue

$6,50,000

$10,00,000

$5,00,000

$21,50,000

Workings:

 

January (actual)

February (actual)

March (actual)

April

May

June

July

August

September

Recent and forecast sales:

20,000

26,000

40,000

65,000

1,00,000

50,000

30,000

28,000

25,000

Sale price per unit

$10

$10

$10

$10

$10

$10

$10

$10

$10

Revenue

$2,00,000

$2,60,000

$4,00,000

$6,50,000

$10,00,000

$5,00,000

$3,00,000

$2,80,000

$2,50,000

Schedule of Expected Cash Collections from Sales

Schedule of Expected Cash Collections from Sales

April

May

June

Total

20% Collection in same month of sale

$1,30,000

$2,00,000

$1,00,000

$4,30,000

70% collected in following month

$2,80,000

$4,55,000

$7,00,000

$14,35,000

10% collected in the second month

$26,000

$40,000

$65,000

$1,31,000

Total

$4,36,000

$6,95,000

$8,65,000

$19,96,000

Workings:

 

January (actual)

February (actual)

March (actual)

April

May

June

July

August

September

Recent and forecast sales:

20,000

26,000

40,000

65,000

1,00,000

50,000

30,000

28,000

25,000

Sale price per unit

$10

$10

$10

$10

$10

$10

$10

$10

$10

Revenue

$2,00,000

$2,60,000

$4,00,000

$6,50,000

$10,00,000

$5,00,000

$3,00,000

$2,80,000

$2,50,000

20% Collection in same month of sale

$40,000

$52,000

$80,000

$1,30,000

$2,00,000

$1,00,000

$60,000

$56,000

$50,000

70% collected in following month

 

$1,40,000

$1,82,000

$2,80,000

$4,55,000

$7,00,000

$3,50,000

$2,10,000

$1,96,000

10% collected in the second month

 

 

$20,000

$26,000

$40,000

$65,000

$1,00,000

$50,000

$30,000

Total

$40,000

$1,92,000

$2,82,000

$4,36,000

$6,95,000

$8,65,000

$5,10,000

$3,16,000

$2,76,000


Merchandise Purchases Budget

Purchase Materials in units

April

May

June

Total

Recent and forecast sales:

65000

100000

50000

215000

Ending inventory

40000

20000

12000

12000

Total Material units

105000

120000

62000

227000

Less: Opening inventory

26000

40000

20000

26000

Purchase Materials in units

79000

80000

42000

201000

Purchase Materials in $

April

May

June

Total

Purchase Materials in units

79000

80000

42000

201000

Cost per unit

$4

$4

$4

$4

Purchase materials in $

$3,16,000

$3,20,000

$1,68,000

$8,04,000

ORDER NEW CASH BUDGET ASSIGNMENT & GET 100% ORIGINAL SOLUTION AND QUALITY WRITTEN CONTENTS IN WELL FORMATS AND PROPER REFERENCING.

Workings:

 

January (actual)

February (actual)

March (actual)

April

May

June

July

August

September

Recent and forecast sales:

20,000

26,000

40,000

65,000

1,00,000

50,000

30,000

28,000

25,000

Ending inventory

10400

16000

26000

40000

20000

12000

11200

10000

0

Total Material units

30,400

42,000

66,000

1,05,000

1,20,000

62,000

41,200

38,000

25,000

Less: Opening inventory

26000

10400

16000

26000

40000

20000

12000

11200

10000

Purchase Materials in units

4,400

31,600

50,000

79,000

80,000

42,000

29,200

26,800

15,000

Cost per unit

$4

$4

$4

$4

$4

$4

$4

$4

$4

Purchase Costs

$17,600

$1,26,400

$2,00,000

$3,16,000

$3,20,000

$1,68,000

$1,16,800

$1,07,200

$60,000

Cash Disbursements for Merchandise Purchases

Cash disbursements for merchandise purchases

April

May

June

Total

50% paid in purchase month

$1,58,000

$1,60,000

$84,000

$4,02,000

50% paid in following month

$1,00,000

$1,58,000

$1,60,000

$4,18,000

Total Cash disbursements

$2,58,000

$3,18,000

$2,44,000

$8,20,000

Workings:

 

January (actual)

February (actual)

March (actual)

April

May

June

July

August

September

Purchase Costs

$17,600

$1,26,400

$2,00,000

$3,16,000

$3,20,000

$1,68,000

$1,16,800

$1,07,200

$60,000

50% paid in purchase month

$8,800

$63,200

$1,00,000

$1,58,000

$1,60,000

$84,000

$58,400

$53,600

$30,000

50% paid in following month

 

$8,800

$63,200

$1,00,000

$1,58,000

$1,60,000

$84,000

$58,400

$53,600

Total Cash Disbursements

$8,800

$72,000

$1,63,200

$2,58,000

$3,18,000

$2,44,000

$1,42,400

$1,12,000

$83,600

Cash Budget

Cash Budget

April

May

June

Total

Receipts:

 

 

 

 

Collection from customers

$4,36,000

$6,95,000

$8,65,000

$19,96,000

Borrowings

$1,70,000

$10,000

 

$1,80,000

Total Receipts

$6,06,000

$7,05,000

$8,65,000

$21,76,000

Disbursements:

 

 

 

 

Payment for merchandise

$2,58,000

$3,18,000

$2,44,000

$8,20,000

Payment for Sale commission

$26,000

$40,000

$20,000

$86,000

Advertising payment

$2,00,000

$2,00,000

$2,00,000

$6,00,000

Payment for rent

$18,000

$18,000

$18,000

$54,000

Payment for wages and salaries

$1,06,000

$1,06,000

$1,06,000

$3,18,000

Payment for utilities

$7,000

$7,000

$7,000

$21,000

Payment for New Equipment

 

$16,000

$40,000

$56,000

Payment of dividend

$15,000

 

 

$15,000

Repayment of borrowings

 

 

$1,80,000

$1,80,000

Repayment of interest on borrowings

 

 

$3,500

$3,500

Total Disbursements

$6,30,000

$7,05,000

$8,18,500

$21,53,500

Change in cash

($24,000)

$0

$46,500

$22,500

Opening Balance

$74,000

$50,000

$50,000

$74,000

Closing Balance

$50,000

$50,000

$96,500

$96,500

Budgeted Income Statement

Budgeted Income Statement

For First Quarter Ending June 30

Sales Revenue

$21,50,000

Less: Variable Costs

 

Cost of sales

$8,60,000

Sales commissions

$86,000

Total Variable costs

$9,46,000

Contribution

$12,04,000

Less: Fixed Costs

 

Advertising

$6,00,000

Rent

$54,000

Wages and salaries

$3,18,000

Utilities

$21,000

Insurance

$9,000

Depreciation

$42,000

Total Fixed costs

$10,44,000

Income

$1,60,000

Budgeted Income Statement

Budgeted Balance Sheet

As on 30 June

Assets

Cash

$96,500

Accounts receivable

$5,00,000

Inventory**

$48,000

Prepaid insurance

$12,000

Fixed assets, net of depreciation

$9,64,000

Total assets

$16,20,500

 

 

Liabilities and Shareholders' Equity

Accounts payable

$84,000

Dividends payable

$15,000

Common shares

$8,00,000

Retained earnings

$7,21,500

Total liabilities and shareholders' equity

$16,20,500


Workings:

Workings:


Outstanding accounts receivable for May

$1,00,000

Outstanding accounts receivable for June

$4,00,000

Total Accounts receivable

$5,00,000



Outstanding accounts payable for June

$84,000





Retained Earnings

 

Opening balance

$5,80,000

Add: Income during first quarter

$1,56,500

Less: Dividend

$15,000

Closing Balance

$7,21,500

Recommendation

The above discussion and calculation reflect Perfect Stitch Replica's Limited is efficient to manage its cash flows, but there is a need to manage the cash flows appropriately. In April month, there is a need to borrow $170,000 for maintaining minimum ending cash balance of $50,000. In May month, the company further needs to borrow $10,000 to maintain a minimum balance. However, in June, the company is able to generate sufficient cash from its sales revenue via collections from the accounts receivables because the company is efficient to repay all the borrowings taken in April and May with the interest by keeping higher ending cash balance than the required minimum balance. Therefore, the company is able to manage its liquidity by borrowings in the first two months in the first quarter.

GET GUARANTEED SATISFACTION OR MONEY BACK UNDER CASH BUDGET ASSIGNMENT HELP SERVICES OF EXPERTSMINDS.COM - ORDER TODAY NEW COPY OF THIS ASSIGNMENT!

Tag This :- Cash Budget Assignment Help, TG98FAR216MAN

get assignment Quote

Assignment Samples

    Benchmark - Policy Assignment Help

    benchmark - policy assignment help-Describe the policy health issue. Discuss the impact on the health care delivery system. Create a problem statement.

    NMR Assignment Help

    nmr assignment help - Elucidate the structure based on the NMR spectra provided. NMR spectra provided includes 1H, 13C, DEPT 135, DEPT 90, COSY and HSQC

Get Academic Excellence with Best Skilled Tutor! Order Assignment Now! Submit Assignment