The accountant for Ericas Dress Shop prepared the following

The accountant for Erica\'s Dress Shop prepared the following cash budget Erica\'s desires to maintain a cash cushion of $19 000 at the enid of each month. Funds are assumed to be borrowed and repaid on the last day of each month interest is charged at the rate of 1 percent per month uired: Complete the cash budget by iling in the missing amounts (Any repayments should be indicated with a mious sign. Round your answers to the nearest whole doltar amount.) Cash Budget July August Se Section 1 Cash receipts Beginning cash balance 45,000 Add cash receipts S 19,00 19.000 85,000 205,000 245600 230,000 224,000 264 600 Total cash available Section 2 Cash payments For inventory purchases For S&A; expenses For interest expense 168,026 142.730176 652 57,000 63,06063.932 Total bodgeted disbursements 225,026 Section 3 Financing activities Surplus (shortage) 14,026 19.000$ 19,000 $ 19,000 Endng cash balance Dere te amount ofn cash fows fro operating acivities Erica\'s will raport on the third quarter r to the the amount of net cash Bows from financing activities Erica\'s will report on the third quarter pro forma sateentof cuh Fows (Round Intermediate calculations and final answer to the

Solution

a

Cash Budget

July

August

September

Section 1 Cash receipts

Beginning cash balance

$    45,000.00

$    19,000.00

$    19,000.00

Add: cash receipts

$ 185,000.00

$ 205,000.00

$ 245,600.00

Total Cash Available

$ 230,000.00

$ 224,000.00

$ 264,600.00

Section 2 Cash Payments

For Inventory Purchase

$ 168,026.00

$ 142,730.00

$ 176,652.00

For S&A Expenses

$    57,000.00

$    63,060.00

$    63,932.00

For Interest Expense

$                   -  

$          140.26

$          149.56

Total Budgeted disbursements

$ 225,026.00

$ 205,930.26

$ 240,733.56

Section 3 Financing Activities

Surplus (shortage)

$      4,974.00

$    18,069.74

$    23,866.44

Borrowings (repayments)

$    14,026.00

$          930.26

$    -4,866.44

Ending Cash Balance

$    19,000.00

$    19,000.00

$    19,000.00

b

Operating Cash Flows

Receipts from Customers

$            635,600

Less: cash paid to Suppliers

$        (487,408)

Less: Cash paid for Operating Expenses

$         (183,992)

Less: Cash Paid for Interest Expenses

$                  (290)

Cash Used in Operating Activities

$            (36,090)

c

Cash Flow from Investing Activities

Proceeds from bank loan

$              14,956

Repayments of Loan

$              -4,866

Net Cash Flow from Investing Activities

$              10,090

a	Cash Budget	July	August	September
	Section 1 Cash receipts
	Beginning cash balance	$    45,000.00	$    19,000.00	$    19,000.00
	Add: cash receipts	$ 185,000.00	$ 205,000.00	$ 245,600.00
	Total Cash Available	$ 230,000.00	$ 224,000.00	$ 264,600.00
	Section 2 Cash Payments
	For Inventory Purchase	$ 168,026.00	$ 142,730.00	$ 176,652.00
	For S&A Expenses	$    57,000.00	$    63,060.00	$    63,932.00
	For Interest Expense	$                   -	$          140.26	$          149.56
	Total Budgeted disbursements	$ 225,026.00	$ 205,930.26	$ 240,733.56
	Section 3 Financing Activities
	Surplus (shortage)	$      4,974.00	$    18,069.74	$    23,866.44
	Borrowings (repayments)	$    14,026.00	$          930.26	$    -4,866.44
	Ending Cash Balance	$    19,000.00	$    19,000.00	$    19,000.00