Question

CASH BUDGET WITH EXPLANATION Budget Information. December 2017 - March 2018 our bank account Assignment 5 Part A THE CASH BUDGET WITH EXPLANATION Millennium Corporation Cash Budget Information - December 2017 - March 2018 Budget Items Total Sales Credit Sales December 1.200.000 1.080.000 January Jar 1.500.000 1.350.000 February 1300000 1,300,000 1.170,000 March 1,400,000 1,260,000 300.000 30.000 15.000 310,000 30,000 16,000 Wages & Salaries Rentals Other Expenses Taxes Paid Dividends Equipment Purchase Cash Balance 325,000 30.000 17.000 150,000 50.000 declared 90,000 ordered 100.000 50,000 paid 90,000 paid Assumptions: 1. The company must maintain a $50,000 cash balance at the end of each month 2.. 30% of credit sales are collected in the month of sale. 3. The credit sales balance is collected one month after the month of sale for each month 4. The company buys 70% of next month sales and these purchases are paid for in the following month 5. April sales is expected to be $1,100,000 Required: Use the template below to show the company receipts and disbursement of cash as per the simulation above And answer the questions that follow.

Answer 1

Millenium corporation Cash Budget Worksheet for 1st Quarter,2018
	jan	Fen	march	Total
Total Sales	15,00,000	13,00,000	14,00,000	42,00,000
Credit Sales	13,50,000	11,70,000	12,60,000	37,80,000
cash Sale	1,50,000	1,30,000	1,40,000	4,20,000
Collection of A.R
70% of last month sale	7,56,000	9,45,000	8,19,000	25,20,000
30% of current month sale	4,05,000	3,51,000	3,78,000	11,34,000
Total Collection	13,11,000	14,26,000	13,37,000	40,74,000
Estimated purchases
70%of next month sale	9,10,000	9,80,000	7,70,000	26,60,000
estimated payments	10,50,000	9,10,000	7,70,000	27,30,000
Cash Budget For the 1st qtr
	jan	feb	march	tota
Sales	$       15,00,000	$       13,00,000	$       14,00,000	$       42,00,000
Projected cash balance	$         1,00,000	$            50,000	$         1,31,000
beginning month
Receipts:
Cash collection	$         1,50,000	$         1,30,000	$         1,40,000	$         4,20,000
Accounts Receivable Collection	$       11,61,000	$       12,96,000	$       11,97,000	$       36,54,000
Total cash Available	$       14,11,000	$       14,76,000	$       14,68,000	$       40,74,000
Disbursements
Payments of accoints payable	$       10,50,000	$         9,10,000	$         7,70,000	$       27,30,000
Wahes & Salaries	$         3,25,000	$         3,00,000	$         3,10,000	$         9,35,000
Rent	$            30,000	$            30,000	$            30,000	$            90,000
Other expenses	$            17,000	$            15,000	$            16,000	$            48,000
Taxes	$         1,50,000			$         1,50,000
Dividend			$            50,000	$            50,000
Purchase of equipment		$            90,000		$            90,000
				$                     -
Total Disbursements	$       15,72,000	$       13,45,000	$       11,76,000	$       40,93,000
				$                     -
Excess of available cash	$                     -	$        1,31,000	$        2,92,000	$        4,23,000
Cash loan needed to maintain	$         2,11,000	$                     -	$                     -	$         2,11,000
Balance of 50,000				$                     -
				$                     -
Projected cash balance at the ned	$            50,000	$                     -	$                     -	$            50,000
CumulativeNet borrowings	$         2,11,000	$         2,11,000	$         2,11,000	$         2,11,000
		$                     -	$                     -	$                     -