The accountant of the company "PHIVOS" has collected the following information about the
year 2022:

	Nov in euros	Dec
sales	50000	70000
selling and admin expenses	24000	26000
supplies	5000	7000
general expenses	6000	8000

The projected data for the year 2023 are:

	jan	feb	march
sales	55000	40000	80000
selling and admin expenses	24000	22000	26000
supplies	5000	5000	4000
general expenses	6000	5000	7000

From sales, 70% is collected in the month of sale, 20% per month
after the sale and 10% in the second month after the sale.
 Supplies, distribution and administration costs as well as others in general
expenses are paid in the month of their purchase.
 The company has borrowed and will remain borrowed for the next six months
with the amount of €20,000. The annual interest rate is 6% and interest is paid
every quarter. Also, the income tax amounts to €5,000 and must
to be paid at the end of March.
 The cash balance on December 31, 2022 is €50,000

1. Prepare the cash budget for the months of January,
February and March (2 credits)
2. Briefly explain how budgeting helps the executives of a company
of business (0.5 units)

Answer rating: 100% (QA)

Answer 1 Jan Feb Mar Cash Receipts Sales 70 38500 28000 56000 Sales 20 10000 8000 16000 Sales 10 ... View the full answer