budget 460776

Budgeted cash sales

15,000

18,000

16,000

Budgeted credit sales

20,000

21,000

22,000

Budgeted inventory purchases

22,000

24,000

28,000

Budgeted selling and admin expenses

3,000

2,000

2,500

Credit sales are expected to be collected 60% in month of sale; 40% in month following

Inventory purchases are expected to be paid 50% in month of purchase; 50% in month following

All selling and admin expenses are expected to be paid in full in month incurred. Depreciation expense is

included in budget at $500 per month

Company budgets the purchase of equipment in February for $45,000

Company maintains a minimum cash balance of $10,000

Interest rate for any borrowings is 6%. Borrowings (and repayments) are always made on the last day of the month

Prepare a cash budget for January, February and March.