Question

Kelsey is preparing its master budget for the quarter ended September 30. Budgeted sales and cash payments for merchandise for the next three months follow Budgeted Sales Cash payments for merchandise July $62,800 42,800 August $81, 2ee 32,400 September $49,200 33,200 Sales are 20% cash and 80% on credit. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $13,500 in cash: $49,600 in accounts receivable: $5.700 in accounts payable, and a $3,200 balance in loans payable. A minimum cash balance of $13,200 is required. Loans are obtained at the end of any month when a cash shortage occurs Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. If an excess balance of cash exists, loans are repaid at the end of the month. Operating expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($5,200 per month), and rent ($7700 per month). (1) Prepare a cash receipts budget for July August, and September (2) Prepare a cash budget for each of the months of July, August, and September Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a cash receipts budget for July, August, and September July 62,800 August 81,200 September $ 49,200 Total sales $ $ Cash sales 20% Credit sales 80% KELSEY Cash Receipts Budget For July, August, and September August Cash sales Collections of accounts receivable Total cash receipts July September Required 2 >

Answer 1

August September NO $13,500 $12,560 $49,600 $75,660 $13,200 $16,240 $50,240 $79,680 $17,723 $9,840 $64,960 $92,523 Receipts Beginning Cash Balance 5 Cash Sale Collection From Account Receivable Total Receipts (A) 8 Payments Cash Payment for marchendise 10 Payment to Account Payables Commission (10% of Sales) office Salary ($5,200 par month) 13 Rent ($7,700 par month) 14 Total Payments (B) 15. Surplus/ Deficit (C) = (A-B) 16 Borrow Repayment 18 Interest (1% of Opening Loan) Closing Cash balance 20 Minimum Cash Balance 21 22 Sales receipts $42,800 $5,700 $6,280 $5,200 $7,700 $67,680 $7,980 $5,252 $0 $32 $13,200 $13,200 $32,400 $0 $8,120 $5,200 $7,700|| $53,420 $26,260 $0 $8,452 $85 $17,723 $13,200 $33,200 $0 $4,920 $5,200 $7,700 $51,020 $41,503 $0 $0 SO po $41,503 $13,200 23 June Total Sales 25 Cash Sale @ 20% 26 Credit Sale @ 80% Cash Realised July August September $62,800 $81,200 $49,200 $12,560 $16,240 $9,840 $50,240 $ 64,960 $39,360 $62,160 $66,480 $74,800 $49,600 June July $3,200 29 Loan 30 31 Opening Loan Balance 32 Loan Taken 33 Loan Paid 34 Closing Loan Balance 35 Interest (1% of Opening Loan) 36 August September $3,200 $8,452 $0 $5,252 $0 sol $8.452 Sol $8,452 SO $32 $85 $0 $0 $3,200