please full calculation and explanation.
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Pet Place | ||
Sales Budget | March | Note |
Budgeted Sales Revenue | 360,000.00 | A |
Budgeted cash receipts | ||
60% of sales of March | 216,000.00 | B=A*60% |
Collection of sales made in January & February | 100,500.00 | C |
Collection of sales of display cases | 5,000.00 | D |
Budgeted cash receipts | 321,500.00 | E=B+C+D |
Budgeted cost of Raw Material Purchases | March | |
Budgeted Purchases- 50% of sales | 180,000.00 | F=A*50% |
Payment for purchases Budget | ||
75% of payable of March | 135,000.00 | G=F*75% |
February payable | 35,280.00 | H |
Total | 170,280.00 | I=G+H |
Less: 2% discount | 3,405.60 | J=I*2% |
Payment for purchases Budget | 166,874.40 | K=I-J |
Payment for Operating Expenses Budget | ||
Rent at 8% of sales | 28,800.00 | L= A*8% |
Advertising | 27,000.00 | M |
Employee compensation | 72,000.00 | N |
Payment for Operating Expenses Budget | 127,800.00 | O=L+M+N |
Cash budget | ||
Beginning Cash Balance | 7,000.00 | |
Plus: Budgeted cash receipts | 321,500.00 | See E |
Total cash available | 328,500.00 | |
Less: Budget cash payments | ||
Payment for purchases Budget | 166,874.40 | See K |
Payment for Operating Expenses Budget | 127,800.00 | See O |
Preliminary cash balance | 33,825.60 | |
Minimum cash balance | 30,000.00 | |
Cash borrowed/ (repaid) | - | |
Ending cash balance | 33,825.60 | |
The ending cash balance is $ 33,825.60 which is greater than minimum requirement of $ 30,000 so borrowing is not needed in March. | ||
Depreciation is non cash expense so not considered. | ||
Insurance is prepaid so not considered. | ||
please full calculation and explanation. PetPlace requires a minimum cash balance of $30,000 at the end...
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