Castie corporation prepares monthly cash Budgets. Here are relevant data from op

Question

Castie corporation prepares monthly cash Budgets. Here are relevant data from operating Buagets For 2014 All sales and purchases are on account. Budgeted collections and disbursement data are given below. All other expenses are paid in the month incurred except for administrative expenses, which include $1,310 of depreciation per month. 1. Collections from customers: January $334,950; February $378,090. 2. Payments for purchases: January $108,200; February $141,340. 3. Other receipts: January: collection of December 31, 2013, notes receivable $17,650; February: proceeds from sale of securities $5,000. 4. Other disbursements: February $12,170 cash dividend. The company's cash balance on January 1, 2014, is expected to be S48,740. The company wants to maintain a minimum cash balance of $57,739. Prepare a cash budget for January and February.

Explanation / Answer

Details January February Opening Cash      48,740.00      59,980.00 Add: Collection From Customers 3,34,950.00 3,78,090.00 Other Recipts      17,650.00        5,000.00 Total Receipts 4,01,340.00 4,43,070.00 Less: Payments For Purchases 1,08,200.00 1,41,340.00 Salaries      83,780.00      81,350.00 Administartive Expenses      71,220.00      74,680.00 Selling Expenses      78,160.00      87,020.00 Other Disbursements      12,170.00 Total payments 3,41,360.00 3,96,560.00 Closing Cash      59,980.00      46,510.00 Min Cash to be maintained      57,739.00 Shortfall to Be met      11,229.00

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