Question

Budgeting is useful to many different types of entities. One is the individual. Consider someone who has just graduated from college and earns $48,000 per year, is unmarried, and has no children. Prepare a cash budget for this college graduate, showing all revenues and expenses. Identify possible sources of cash and the amount to be received from each. Identify the costs such a person is likely to incur during the year. You can assume that cash disbursements are made immediately for all expenses.

Answer 1

Preparation of Cash Budget: Cash Budget for Year Cash Collections: Salary or Remuneration 48,000.00 Total Cash Collections 48,000.00 Cash Disbursements: House Rental Expenses Food Expenses Medical Expenses Insurance Expenses Travelling Expenses Entertainment Expenses (movies etc.) Miscellaneous Expenses 9,600.00 7,200.00 4,800.00 4,320.00 3,360.00 1,920.00 1,200.00 Total Cash Disbursements 32,400.00 Total Available Cash Balance 15,600.00

Cash Budget for Monthly Cash Collections: Salary or Remuneration 4,000.00 Total Cash Collections 4,000.00 Cash Disbursements: House Rental Expenses Food Expenses Medical Expenses Insurance Expenses Travelling Expenses Entertainment Expenses (movies etc.) Miscellaneous Expenses VÀ VÀ CÀ VÀ 800.00 600.00 400.00 360.00 280.00 160.00 100.00 2 VÀ 02 | Total Cash Disbursements 2,700.00 || Total Available Cash Balance 1,300.00