Assume that you are the accounts executive for La Casa Pte Ltd (La Casa), an online retailer
Question:
Assume that you are the accounts executive for La Casa Pte Ltd (‘La Casa’), an online retailer which sells gym bags bought from an overseas supplier.
The following information is available for La Casa:Forecast Sales Volume is shown as below:
Forecasted sales | No. of gym bags (in units) |
May 2023 | 5,160 |
Jun 2023 | 4,850 |
July 2023 | 5,230 |
The cost price and selling price per gym bag are $125 and $200 respectively. 80% of each month’s sales are estimated to be cash sales collected within the same month. The remainder will be credit sales and will be received in the following month.40% of the expenses relating to the purchase of gym bags will be paid within the same month. The remainder will be credit purchases and will be paid in the following month. Selling and Administrative Expenses are expected to remain constant at $2,000 per month, and will be paid within the same month. Beginning Cash for June 2023 is expected to be $10,000.
Required:
Prepare the following budgets for La Casa Pte Ltd for June 2023 based on the information above. You can use the templates below to answer this question.
Cash Receipt Budget;
Cash Disbursement Budget; and
Cash Budget
La Casa Pte Ltd | ||
Cash Receipt Budget | ||
June 2023 | ||
Cash Sales in the current month | ||
Add Collection of Credit Sales | ||
Total Cash Collection | ||
Cash Disbursement Budget | ||
June 2023 | ||
Payment of current month’s purchases | ||
Add Payment of Credit Purchases | ||
Add Payment of Selling & Administrative Expense | ||
Total Cash Disbursement |
Cash Budget
June 2023 | |
Beginning cash balance | |
Add: Budgeted cash collection | |
Less: Budgeted cash disbursement | |
Ending cash balance |
College Accounting A Contemporary Approach
ISBN: 978-0077639730
3rd edition
Authors: David Haddock, John Price, Michael Farina