Danner Company expects to have a cash balance of $52,965 on January 1, 2017. Relevant monthly budget data for the first 2 months of 2017 are as follows. Collections from customers: January $100,045, February $176,550. Payments for direct materials: January $58,850, February $88,275. Direct labor: January $35,310, February $52,965. Wages are paid in the month they are incurred. Manufacturing overhead: January $24,717, February $29,425. These costs include depreciation of $1,765 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $17,655, February $23,540. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $14,124 in cash. Danner Company has a line of credit at a local bank that enables it to borrow up to $29,425. The company wants to maintain a minimum monthly cash balance of $23,540.

Prepare a cash budget for January and February.

Beginning cash balance ...........

Add: Receipts

Collections from customers ......................

Sale of marketable securities ....................

Total receipts ..............................................

Total available cash ................................................

Less: Disbursements

Direct materials ...........................................

Direct labor ..................................................

Manufacturing overhead ............................

Selling and administrative expenses ........

Total disbursements ..................................

Excess (efficiency) of available cash over cash.............

disbursements.....................................................

Financing

Add Borrowings ....................................................

Less: Repayments ..................................................

Ending cash balance ..............................................

.

Answer rating: 100% (QA)

Danner Company Cash Budget January and February 2017 ItemJanuaryFebruaryTotal Beginning cash balance52965 Jan Ending Cash Add Receipts Collections from customers100045176550276595 Sale of marketable securities14124014124 Total receipts114169176550290719 Total available cash167134 Feb Beginning Cash Less Disbursements Direct materials5885088275147125 Direct labor353105296588275 Manufacturing overhead247172942554142 Selling and administrative expenses176552354041195 Total disbursements136532194205330737 Excess deficiency of available cash over disbursements306021765540253 Financing Add Borrowings17655017655 Less Repayments01765517655 Ending cash balance ... View the full answer