Question

prepare a cash budget for January colter company

CALCULATOR PRINTER VERSION CRACK Colter Company prepares monthly cash budgets. Relevant data from operating budgets for 2017 are as follows: January February Sales Direct materials purchases Direct labor Manufacturing overhead Selling and administrative expenses $426,960 142,320 106,740 83,020 93,694 $474,400 148,250 118,600 88,950 100,810 All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (6096) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred except for selling and administrative expenses that include $1,186 of depreciation per month Other data: 1. Credit sales: November 2016, $296,500; December 2016, $379,520. 2. Purchases of direct materials: December 2016, $118,600 3. Other receipts: January-Collection of December 31, 2016, notes receivable $17,790; February-Proceeds from sale of securities $7,116. 4. Other disbursements: February-Payment of $7,116 cash dividend. The company's cash balance on January 1, 2017, is expected to be $71,160. The company wants to maintain a minimum cash balance of $59,300.

Answer 1

Cash Budget
	January	February
Beginning Balance	$          71,160	$         60,486
Cash Receipts
Cash Collections from Customers	$       3,86,636	$      4,41,192
Collection of Notes Receivable	$          17,790
Proceeds from sale of security		$            7,116
Total Cash Receipts	$       4,04,426	$      4,48,308
Total Cash Available	$       4,75,586	$      5,08,794
Cash Disbursements
Purchases	$       1,32,832	$      1,45,878
Direct Labor	$       1,06,740	$      1,18,600
Manufacturing Overhead	$          83,020	$         88,950
Selling and Administrative Expenses	$          92,508	$         99,624
Dividend paid		$            7,116
Total Cash Disbursements	$       4,15,100	$      4,60,168
Preliminary Ending Balance	$          60,486	$         48,626
Financing
Borrowings	$                   -	$         10,674
Repayment
Interest
Total Financing	$                   -	$         10,674
Ending Balance	$          60,486	$         59,300