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17 October, 21:38

Deitz Corporation is projecting a cash balance of $32,400 in its December 31, 2019, balance sheet. Deitz's schedule of expected collections from customers for the first quarter of 2020 shows total collections of $199,800. The schedule of expected payments for direct materials for the first quarter of 2020 shows total payments of $46,440. Other information gathered for the first quarter of 2020 is sale of equipment $3,240; direct labor $75,600, manufacturing overhead $37,800, selling and administrative expenses $48,600; and purchase of securities $15,120. Deitz wants to maintain a balance of at least $27,000 cash at the end of each quarter.

Prepare a cash budget for the first quarter Dietz corporation.

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  1. 17 October, 21:57
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    Dietz corporation cash budget for the first quarter

    Total Receipts:

    Collections from Customers $199,800

    Receipts from Sale of Equipment $3,240

    $203,040

    Total Payments:

    Direct materials $46,440

    Direct labor $75,600

    Manufacturing overhead $37,800

    Selling and administrative expenses $48,600

    Purchase of securities $15,120

    $223,560

    Net Receipts / (Payments) ($20,520)

    Opening Balance $32,400

    Closing Balance $11,880

    Required Balance $27,000

    Loan (Shortfall) $15,120

    Explanation:

    A cash Budget shows the future estimate of future cash incomes and cash expenditures.
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