Cash Budget E10A. Quecnsland Enterprises necds a cash budget for the month of Junc. The following information is available The cash balance on Junc 1 is $13,000 Sales for May and June are $40,000 and S50,000, respectively. Cash collections on sales are 45 percent in the month of sale and 50 percent in the month after the sale; 5 percent of sales are uncollectible Gencral expenses budgeted for June are S20,000 (depreciation represents $1,000 of this amount) Inventory purchases will total $40,000 in May and $30,000 in Junc. The company pays for half of its inventory purchases in the month of purchase and for the other half the month after purchase The company will pay $5,000 in cash for office furniture in June. Sales commissions for June are budgeted at $3,000 The company maintains a minimum ending cash balance of $5,000 and can borrow from the bank in multiples of $100. All loans are repaid after 60 days. Prepare a cash budget for Queensland for the month of June
Queensland Enterprises
Cash Budget
June
Cash Receipts :
June sales $(50000*0.45)=22500
May sales $(40000*0.50)=20000
Total cash receipts 42500
Cash Payments :
General expenses $20000
less depreciation- $1000 19000
Purchases : May $(40000*0.50) = 20000
June $(30000*0.50) = 15000 35000
Office furniture 5000
Sales commissions 3000
Total cash payments 62000
Change in cash $(62000-42500) 19500
Beginning cash 13000
Borrowings -
Repayments -
Ending cash 5000
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