Danner Company expects to have a cash balance of $58,005 on
January 1, 2017. Relevant monthly budget data for the first 2
months of 2017 are as follows.
Collections from customers: January $109,565, February $193,350. |
Payments for direct materials: January $64,450, February $96,675. |
Direct labor: January $38,670, February $58,005. Wages are paid in the month they are incurred. |
Manufacturing overhead: January $27,069, February $32,225. These costs include depreciation of $1,933 per month. All other overhead costs are paid as incurred. |
Selling and administrative expenses: January $19,335, February $25,780. These costs are exclusive of depreciation. They are paid as incurred. |
Sales of marketable securities in January are expected to realize
$15,468 in cash. Danner Company has a line of credit at a local
bank that enables it to borrow up to $32,225. The company wants to
maintain a minimum monthly cash balance of $25,780.
Prepare a cash budget for January and February.
Solution
DANNER COMPANY | ||
Cash Budget | ||
For january and February' 2014 | ||
January | February | |
Beginning cash | $ 58,005.00 | $ 35,447.00 |
Cash Collections | $ 109,565.00 | $ 193,350.00 |
Sales for marketable securities | $ 15,468.00 | |
Available cash balance | $ 183,038.00 | $ 228,797.00 |
Cash Disbursements for | ||
Direct material | $ 64,450.00 | $ 96,675.00 |
Direct Labor | $ 38,670.00 | $ 58,005.00 |
Manufacturing Overheads | $ 25,136.00 | $ 30,292.00 |
Selling and Administrative expenses | $ 19,335.00 | $ 25,780.00 |
Total cash Disbursements | $ 147,591.00 | $ 210,752.00 |
Ending Cash Balance before financing | $ 35,447.00 | $ 18,045.00 |
Minimum Cash Balance Desired | $ 25,780.00 | $ 25,780.00 |
Projected cash Excess (deficit) | $ 9,667.00 | $ (7,735.00) |
Financing | ||
Borrowing | $ 7,735.00 | |
Principal repayments | $ - | $ - |
Total Effects of Financing | $ - | $ 7,735.00 |
Ending Cash Balance | $ 35,447.00 | $ 25,780.00 |
Danner Company expects to have a cash balance of $58,005 on January 1, 2017. Relevant monthly...
Danner Company expects to have a cash balance of $46,035 on January 1, 2017. Relevant monthly budget data for the first 2 months of 2017 are as follows: Collections from customers: January $86,955, February $153,450. Payments for direct materials: January $51,150, February $76,725. Direct labor: January $30,690, February $46,035. Wages are paid in the month they are incurred. Manufacturing overhead: January $21,483, February $25,575. These costs include depreciation of $1,535 per month. All other overhead costs are paid as incurred....
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Danner Company expects to have a cash balance of $54,000 on January 1, 2020. Relevant monthly budget data for the first 2 months of 2020 are as follows. Collections from customers: January $102,000, February $180,000. Payments for direct materials: January $60,000, February $90,000. Direct labor: January $36,000, February $54,000. Wages are paid in the month they are incurred. Manufacturing overhead: January $25,200, February $30,000. These costs include depreciation of $1,800 per month. All other overhead costs are paid as incurred....
Exercise 23-14 Danner Company expects to have a cash balance of $49,500 on January 1, 2017. Relevant monthly budget data for the first 2 months of 2017 are as follows: Collections from customers: January $93,500, February $165,000. Payments for direct materials: January $55,000, February $82,500. Direct labor: January $33,000, February $49,500. Wages are paid in the month they are incurred. Manufacturing overhead: January $23,100, February $27,500. These costs include depreciation of $1,650 per month. All other overhead costs are paid...
Exercise 22-14 (Video) Danner Company expects to have a cash balance of $45,000 on January 1, 2020. Relevant monthly budget data for the first 2 months of 2020 are as follows. Collections from customers: January $85,000, February $150,000. Payments for direct materials: January $50,000, February $75,000. Direct labor: January $30,000, February $45,000. Wages are paid in the month they are incurred. Manufacturing overhead: January $21,000, February $25,000. These costs include depreciation of $1,500 per month. All other overhead costs are...
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