3. Prepare cash budget for the months of June, July, August and September 2016 on the...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
3. Prepare cash budget for the months of June, July, August and September 2016 on the basis of following information: Months Sales (Rs) April May June July August - Purchases Wages (Rs) 4,20,000 4,50,000 5,00,000 4,90,000 5,40,000 September 6,10,000 Additional Information: a) Credit terms: Sales 20% sales are on cash. 50% of the credit sales are collected next month and the balance in the following month Purchases credit allowed by suppliers is 2 months Wages - delay in payment of wages is ½ month Overheads - 1 month b) Interest on debentures of Rs 5,00,000 is to be paid half-yearly in June and December - (Rs) 2,00,000 1,60,000 2,10,000 1,60,000 2,60,000 1,65,000 2,82,000 1,65,000 2,80,000 1,65,000 3,10,000 1,70,000 Expenses (Rs) 45,000 40,000 38,000 37,500 60,800 52,000 c) Dividends on investments amounting to Rs 25,000 are expected to be received in June 2016 d) A new machinery will be installed in June 2016 at a cost of Rs 4,00,000 which is payable in 20 monthly instalments from July 2016 onwards e) Advance income tax to be paid in August 2016 is Rs 15,000 f) Cash balance on 1st June 2016 is expected to be Rs 45,000 3. Prepare cash budget for the months of June, July, August and September 2016 on the basis of following information: Months Sales (Rs) April May June July August - Purchases Wages (Rs) 4,20,000 4,50,000 5,00,000 4,90,000 5,40,000 September 6,10,000 Additional Information: a) Credit terms: Sales 20% sales are on cash. 50% of the credit sales are collected next month and the balance in the following month Purchases credit allowed by suppliers is 2 months Wages - delay in payment of wages is ½ month Overheads - 1 month b) Interest on debentures of Rs 5,00,000 is to be paid half-yearly in June and December - (Rs) 2,00,000 1,60,000 2,10,000 1,60,000 2,60,000 1,65,000 2,82,000 1,65,000 2,80,000 1,65,000 3,10,000 1,70,000 Expenses (Rs) 45,000 40,000 38,000 37,500 60,800 52,000 c) Dividends on investments amounting to Rs 25,000 are expected to be received in June 2016 d) A new machinery will be installed in June 2016 at a cost of Rs 4,00,000 which is payable in 20 monthly instalments from July 2016 onwards e) Advance income tax to be paid in August 2016 is Rs 15,000 f) Cash balance on 1st June 2016 is expected to be Rs 45,000
Expert Answer:
Answer rating: 100% (QA)
To prepare the cash budget for the months of June July August and September 2016 we need to consider the cash inflows and outflows based on the provid... View the full answer
Related Book For
Horngrens Financial and Managerial Accounting
ISBN: 978-0133866292
5th edition
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura
Posted Date:
Students also viewed these accounting questions
-
If we estimated that a student who wanted a part-time job could earn enough money to pay his or her car-related expenses and earn roughly $100 per week in extra spending money. The idea of letting a...
-
Which of the following are requirements to be an S corporation? a. Limited to an absolute maximum of 100 shareholders. b. Has no resident alien shareholders. c. Has only one class of stock. d. May...
-
Which of the following are requirements to be an S corporation? a. Limited to an absolute maximum of 100 shareholders. b. Has no resident alien shareholders. c. Has only one class of stock. d. May...
-
The ordinary share capital of PP Ltd (a trading company) is owned 32% by QQ Ltd, 35% by RR Ltd and 23% by SS Ltd. The remaining 10% is owned by various individuals, none of whom own more than 1%. All...
-
If an entity has a mixed cost function, a 10 per cent increase in sales volume should increase income by more than 10 per cent. Explain why.
-
The price of a bond issued in the United States by a British company and denominated in US dollars is most likely to: A. Change as US interest rates change. B. Change as British interest rates...
-
The efficiency of self-locking machine is less than 50%. True or False
-
Why would a company prefer a foreign currency option over a forward contract in hedging a foreign currency firm commitment? Why would a company prefer a forward contract over an option in hedging a...
-
How does a website like Reddit perform in information sharing? What types of questions are people asking? Are the results relevant? Are they of high quality?
-
The results below are based on data collected as part of a student project for an introductory statistics class at UF. If there is more than one group/treatment, the first group mentioned is group 1....
-
Assignment #1: Scanf Properties (25 marks - 5 marks per section) DUE: September 20, 2022 Individual effort You can answer on the sheet or a separate sheet Type out each of the following programs,...
-
Arrowhead Gallery is a high-end art dealer. Each artwork is uniquely identified by an artwork identification number and is also characterized by a title, artist, date, asking price, and open- ended...
-
2.5 Use the table below and the bank statement to prepare journal entries to close the partners' Drawings accounts at 30 June 2022 to their Current accounts. General Journal of NeoZone for Kids Date...
-
The demand curve for agricultural fertilizer with a watershed can be represented by Q = 40 2P. The marginal private costs are MPC = 0.5Q. Water quality effects (costs) arising from the application...
-
How do theories of socialization, such as symbolic interactionism and social learning theory, help us understand the mechanisms through which individuals acquire and internalize social norms, roles,...
-
FASB created industry-focused topics. It is important to note that the industry-specific guidance in the Codification is incremental - entities must also follow the guidance in other Topics that do...
-
K Given that f(x) = x-9 and g(x)=5x+1, find (fg) if it exists. 5 +
-
(a) What do data breach notification laws require? (b) Why has this caused companies to think more about security?
-
Brill, located in Port St. Lucie, Florida, produces two lines of electric toothbrushes: deluxe and standard. Because Brill can sell all the toothbrushes it can produce, the owners are expanding the...
-
Sinclair Company manufactures T-shirts printed with tourist destination logos. The following table shows sales prices and projected sales volume for the summer months: Prepare a sales budget for...
-
Hayesville Company uses a standard cost system and reports the following information for 2016: Standards: 3 yards of cloth per unit at $1.05 per yard 2 direct labor hours per unit at $10.25 per hour...
-
You own your own firm, and you want to raise \($40\) million to fund an expansion. Currently, you own 100% of the firms equity, and the firm has no debt. To raise the \($40\) million solely through...
-
If investors are holding optimal portfolios, how will the portfolios of a more risk averse and a more risk-tolerant investor differ?
-
According to the managerial entrenchment theory, managers choose capital structures so as to preserve their control of the firm. On the one hand, debt is costly for managers because they risk losing...
Study smarter with the SolutionInn App