Cascade, Ltd., a merchandising firm, is preparing its cash budget for March. The

Question

Cascade, Ltd., a merchandising firm, is preparing its cash budget for March. The following information is available concerning its inventories:

Cascade, Ltd., a merchandising firm, is preparing its cash budget for March. The following information is available concerning its inventories: nventories at beginning of March Estimated purchases for March Estimated cost of goods sold for March Estimated payments in March for purchases in February Estimated payments in March for purchases prior to February Estimated payments in March for purchases in March $ 278,750 1,093,000 1,118,000 273,000 49,000 70% Required: What are the estimated cash disbursements in March? Estimated cash disbursements

Explanation / Answer

CASH BUDGET CALCULATION OF ESTIMATED CASH DISBURSHMENT Amount Cash Outflow Remarks Particualrs inventory at the beginning $                  2,78,750 $                       -   No Cash outflow Estimated purchase of march $               10,93,000 $          7,65,100 Only 70% is paid for purchse of the month of March Estimated Cost of Goods Sold in March $               11,18,000 $                       -   No Cash outflow Estimated payment in march for purchase in February $                  2,73,000 $          2,73,000 Cash Outflow Estimated payment in march for purchase in prior to February $                     49,000 $             49,000 Cash Outflow Total of Cash Outflow = $       10,87,100 Answer = Estimated Cash disburshments in the month of March $       10,87,100

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