1) |
Sales budget for the 2nd Quarter |
||||
April |
May |
June |
Total |
||
Cash Sales (20% of total sales) |
$14,000 |
$17,000 |
$18,000 |
$49,000 |
|
Credit Sales (80% of total sales) |
$56,000 |
$68,000 |
$72,000 |
$196,000 |
|
Total Budgeted Sales |
$70,000 |
$85,000 |
$90,000 |
$245,000 |
|
2) |
Schedule of expected cash collections |
||||
April |
May |
June |
Total |
||
Cash Sales |
$14,000 |
$17,000 |
$18,000 |
$49,000 |
|
Credit Sales |
$48,000 |
$56,000 |
$68,000 |
$172,000 |
|
Total collections |
$62,000 |
$73,000 |
$86,000 |
$221,000 |
|
3) |
Inventory purchases budget |
||||
April |
May |
June |
Total |
||
Budgeted Cost of goods sold (60% of total sales) |
$42,000 |
$51,000 |
$54,000 |
||
Add: Desired ending inventory |
$15,300 |
$16,200 |
$9,000 |
||
Total needs |
$57,300 |
$67,200 |
$63,000 |
||
Deduct: Opening Inventory |
$12,600 |
$15,300 |
$16,200 |
||
Required Purchased |
$44,700 |
$51,900 |
$46,800 |
$143,400 |
|
For May = Total sales $85,000 * 60% cost ratio = $51,000 |
|||||
For June = Total Sales $90,000 * 60% cost ratio = $54,000 |
|||||
For June Desired Ending Inventory = July Sales $50,000 * 60% cost ratio x 30% = $9,000 |
|||||
4) |
Schedule for cash disbursements for purchases |
||||
April |
May |
June |
Total |
||
For March Purchases |
$18,300 |
||||
For April Purchases (50% Paid in April and 50% in May) |
$22,350 |
$22,350 |
|||
For May purchases (50% paid in May and 50% in June) |
$25,950 |
$25,950 |
|||
For June purchases (50% paid in June and 50% in July) |
$23,400 |
||||
Total cash disbursements |
$40,650 |
$48,300 |
$49,350 |
$138,300 |
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