Question

Question 12 View Policies Current Attempt in Progress Danner Company expects to have a cash balance of $56.250 on January 1, 2020. Relevant monthly budget data for the first 2 months of 2020 are as follows. Collections from customers January 5106.250. February $187.500. Payments for direct materials: January 562.500, February $93.750. Direct labor: January $37.500. February 556.250. Wages are paid in the month they are incurred. Manufacturing overhead: January $26.250. February $31.250. These costs include depreciation of $1875 per month. All other overhead costs are paid as incurred Selling and administrative expenses: January $18.750. February $25,000. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January we expected to realize 515.000 inash Damer Company has a line of credit at a local bank that enables it to borrow up to $31.250. The company wants to maintain a minimum monthly cash balance of $25.000 Prepare a cash budget for January and rehnan

Answer 1

Feb Jan $56250__ $34375 Danner company Cash Budget Opening cash Balance Add ? cash Receipts collection from customers Sale of Securities Borrowing from Bank 106250 15000 18 7500 $ 7500 1700 229375 62500 37500 93750 56a SD Less Payments Direct material Direct Labour Manufacturing overheds (exclusive of depreciation Selling and administrative 24375 18750 20 375 25000 $ 143125 204375 Endling cash Balance $34375 $25000 Borrowing from Bank = $204 375-187500 - 34375 $7500