Using the given information, prepare a cash budget for August. Estimated cash re

Question

Using the given information, prepare a cash budget for August.

Estimated cash receipts from:

Sales for July, August, and September are expected to be $200,000, $180,000, and $220,000, respectively, for Pasta Company. All sales are on account and are collected 50 percent in the month of the sale and 50 percent in the following month. On average, customers take a one percent sales discount in the first month. Raw materials are purchased one month before being needed, and all purchases and expenses are paid for as incurred. Activities for the quarter are expected to be: July August September Raw materials used $40,000 $36,000 $44,000 Salaries 70,000 68,000 92,000 Maintenance and repairs 18,000 18,000 18,000 Depreciation 36,000 36,000 36,000 Utilities and other 14,000 14,000 15,000 Dividends paid -0- 10,000 -0- Payment on bonds 8,000 8,000 8,000

Using the given information, prepare a cash budget for August.

Estimated cash receipts from:

Total Cash Receipts Estimated cash payments for: Total Cash payments Cash increase (decrease)

Explanation / Answer

Using the given information, prepare a cash budget for August. Estimated cash re

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