The cash budget is the primary tool used in short-term financial planning. As with many calculations, the
Fantastic news! We've Found the answer you've been seeking!
Question:
The cash budget is the primary tool used in short-term financial planning. As with many calculations, the sales forecast is a primary input. As an example of the cash budgeting process, we will use the Fun Toys Corporation. The sales projections and other information provided are: | ||||||||||
Q1 | Q2 | Q3 | Q4 | |||||||
Sales | $ 200,000,000 | $ 300,000,000 | $ 250,000,000 | $ 400,000,000 | ||||||
Beginning receivables: | $ 120,000,000 | |||||||||
Receivables period (days): | 45 | |||||||||
With the receivables period shown, we can calculate the percentage of sales collected in the current quarter as: | ||||||||||
Percentage of sales received: | ||||||||||
Related Book For
Accounting concepts and applications
ISBN: 978-0538745482
11th Edition
Authors: Albrecht Stice, Stice Swain
Posted Date: