Problem 14

Financial statements and additional information for Noble Equipment Corp. The companys fiscal year end is September 30. Nobles management wants to estimate the companys cash balances for the last 3 months of calendar year 2011, which are the first three months of calendar year 2011, which are the first three months of fiscal year 2012. The questions accompanying the spreadsheet ask you to prepare a monthly cash budget, pro forma financial statements, and a cash flow forecast for the period.

Chapter 3 Problem 14 Template
The following template provides all of the statement forms and captions needed to complete the problem.
PLEASE use it--and do not add/delete/or change any items in the rows: In doing this, I will be able
to give credit for each numerical answer.
Chapter 3 Problem 14 Answers
a. Noble Cash Budget for Last Three Months of 2011
			October	November	December
Cash receipts:
Sales for cash
Collections from credit sales
Total cash receipts
Cash disbursements:
Payment for purchases
Salaries
Interest payments
Principal payments
Dividends
Tax payments
Total cash disbursements
Net cash receipts (disbursements)
Determination of cash needs:
Beginning cash
Net receipts (disbursements)
Ending cash
Minimum cash desired
Cash surplus (deficit)
Noble will need $________ in external financing by the end of December.
	Noble
	Income Statement
	October 1, 2011 - December 31, 2011
	($ thousands)
Net sales
Cost of sales
Gross profit
Selling and admin. expense
Interest
Depreciation
Net profit before tax
Tax at 33%
Net profit after tax
Dividends
Additions to retained earnings
	Noble
	Balance Sheet
	###########
	($ thousands)
Assets
Cash
Accounts receivable
Inventory
Total current assets
Gross fixed assets
- Accumulated depreciation
Net fixed assets
Total assets
Liabilities
Bank loan
Accounts payable
Miscellaneous accruals
Current portion long-term debt
Taxes payable
Total current liabilities
Long-term debt
Shareholders' equity
Total liabilities & equity
Inventory is estimated as follows:
Beginning inventory Oct. 1.
+ 1st quarter purchases
- 1st quarter cost of goods sold
Ending inventory December 31
Taxes payable are estimated as follows:
Taxes payable Sept. 30, 2011
- payments
+ 1st quarter taxes accrued
Taxes payable December 31
a. Noble will require $_________at the end of the year.
b. $__________.
c. Yes / No Why?
d.	Noble
	Cash Flow Forecast
	Last three months 2011
	($ thousands)
Sources of cash
Cash from operations:
Profit after tax
Depreciation
Increase in liabilities or reduction in assets:
Bank loan				<----This is the "plug." i.e., What is needed to
Cash					balance "Sources and Uses"
Accounts receivable
Inventory
Total sources
Uses of cash:
Dividends
Decreases in liabilities or increases in assets:
Accounts payable
Current portion long-term debt
Taxes payable
Total uses