The company is subject to 30% tax rate. Below are the estimated incometax payments per quarter:f.First quarterP500 000Second quarter360 000Third quarter540 000Fourth quarter465 000g.Cash at the beginning of 2015 is P750 000. The company plans to increasethe target cash balançe to P1 million in 2016.h.Sale for the fourth quarter of 2015 was P15 million.Requirements: Prepare the 2016 cash budget. Find out if the company willhave enough cash to pay the P6-million property in the third quarter. Diogenes Dy, the general manager of DG Stores, wants to find out if theircompany has enough cash to pay for a P6-million piece of property which maybe the site of another branch. This is expected to be paid in the third quarterof 2016 should the company decide to buy it. He asked his chief accountant toprepare a cash budget. The following assumptions are used in the preparationof the cash budget.8.Projected quarterly sales are as follows:a.First quarterP12 millionSecond quarter15 millionThird quarter15 millionFourth quarter18 millionSeventy percent (70%) of the sales are collected in the quarter. Theremaining 30% is paid the following quarter.b.Cost of sales is 75% of sales. Inventories are purchased in the same quartersales were generated. Ninety percent of the purchases is paid within thequarter these purchases are made and the remaining 10% is paid thefollowing quarter.С.d.Included in fixed operating expenses are salaries, rent, security whichamount to P1 million for the first two quarters. The amount is expectedto increase to P1.25 million starting third quarter. Variable operating ex-penses are 5% of sales.e.Interest payments amount to P200 000 per quarter.

Let us first determine the cash collections in each quarter: Q4 15 Q1 16 Q2 16 Q3 16…

Answered: Requirements: Prepare the 2016 cash…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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the exercise. If you have the following data for the purpose of preparing the cash budget for Al-Iman Company for the year 2022, which has a capital: 1- Expected monthly sales in 2022: June 100000, July 80000, August 60000, September 100,000, October 80,000. 2- The cash sales are expected to be 10%, and the forward sales are to be made on the basis of 50% in the following month For sale, 20% in the following month, 30% in the third month, and there is a possibility of bad debts at a rate of %15 3- The percentage of gross profit is 40%. 4- The company will purchase monthly raw materials based on the sales of the following month, and the value of. will be paid Purchases in the month following the purchase. 5- The fixed expenses amount to 36000 riyals distributed equally over the months of the year. 6- The monthly consumption is estimated at 2000 riyals. 7- Variable payments are 10% of the sales value, 50% of which is paid in the same month, and the rest in Immediately next month. 8- The…
USE THE FOLLOWING INFORMATION TO ANSWER QUESTIONS 4 TO 6. Whittle Ltd is preparing a cash budget for the first six months of the coming year, 2024. The company’s financial manager has pulled all the cash sales and income from the past year (2023) and adjusted them for the expected growth in the coming year already and calculated net cash flows for each month, except for collections from credit sales. The system however does not do credit collection estimates, however an ageing report has been generated. Credit sales over the last four months of 2023 were as follows: September October November December R10 000 R12 000 R15 000 R45 000 Credit sales for the first 6 months of 2024 were estimated as follows: January February March April May June R5 000 R10 000 R12 000 R14 000 R18 000 R25 000 The ageing analysis indicates that on credit sales, payments are usually made as follows for any given month’s sales: 1 month 2 months 3…
If you have the following data for the purpose of preparing the cash budget for Al-Iman Company for the year 2022, which has a capital:- 1) Expected monthly sales in 2022: June 100000, July 80000, August 60000, September 100000, October 80000. 2) The expected cash sales are 10%, and the forward sales are obtained on the basis of 50% in the month following the sale, 20% in the month following the sale, 30% in the third month, and a bad debt probability of 15% 3) The Gross Profit Ratio is 40% 4) The company will purchase monthly raw materials on the basis of the sales of the following month, and the purchase price will be paid in the month following the purchase. 5) The fixed expenses amount to 36000 riyals distributed equally over the months of the year 6) The monthly consumption is estimated at 2000 riyals 7) Variable payments amount to 10% of the sales value, 50% of which is paid in the same month, and the rest in the immediately following month. 8) The company will purchase a new…
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Use the information provided below to prepare the Cash Budget for January and February 2023:INFORMATIONThe following information was provided by Intel Enterprises:1. The bank balance on 31 December 2022 is expected to be R40 000 (unfavourable).2. Credit sales are expected to be as follows:December 2022 - R576 000 January 2023 - R540 000 February 2023 - R648 0003. Credit sales usually make up 40% of the total sales. Cash sales make up the balance. Cash customersreceive a 10% discount.4. Credit sales are normally collected as follows:* 30% in the month in which the transaction takes place, and these customers are entitled to a 5% discount.* 65% in the following monthThe rest is usually written off as bad debts.5. Budgeted purchases of inventory are as follows:December 2022 - R1 000 000 January 2023 - R800 000 February 2023 - R920 0006. Fifty percent (50%) of the purchases are for cash. The remainder is paid in the month after the purchase.7. The monthly salaries amount to R150 000.…
The management of Rain co which was manufacturing rain coats was preparing a cash budget for the month of June 2021. Opening cash balance=P20,000 Cash anticipated for collection=P75,000 Cash anticipated for disbursement=P100,250 To maintain P5,000 as cash balance what amount needs to be borrowed for June month 2021.
If it can be done in excel, please, I would appreciate it very much (and show the formulas).In preparing the cash budgeting projected balance method, it is necessary to calculate the amount of the inventory balance. The following information is available for the current fiscal year: Inventory balance, $200,000.00, it is known that the inventory turnover is every 60 days. The Cost of Sales is forecasted to increase 15% for the next fiscal year. What is the budgeted inventory balance
Can you please help with the last part of the question. Odane Cranston, the management accountant at BG Merchandising & More, is in the process of planning the company’s cash needs for the last quarter of 2020. Extracts from the sales and purchases budgets are as follows:Month2020CashSalesSalesOn AccountPurchasesOnAccountAugustSeptemberOctoberNovemberDecember$85,000$75,500$69,870$80,030$63,010$520,000$640,000$760,000$680,000$850,000$420,000$400,000$520,000$440,000$540,000i) An analysis of the records shows that trade receivables (accounts receivable) are settled according to the following credit pattern, in accordance with the credit terms 4/30, n90:60% in the month of sale 25% in the first month following the sale15% in the second month following the saleii) Accounts payable are settled as follows, in accordance with the credit terms 2/30, n60:80% in the month in which the inventory is purchased 20% in the following monthiii) In the month of November, the management of BG…
Use the information provided below to prepare the following for January and February 2023: 4.2)Cash Budget INFORMATION The following information was provided by Intel Enterprises:1. The bank balance on 31 December 2022 is expected to be R40 000 (unfavourable).2. Credit sales are expected to be as follows:December 2022 January 2023 February 2023R576 000 R540 000 R648 0003. Credit sales usually make up 40% of the total sales. Cash sales make up the balance. Cash customersreceive a 10% discount.4. Credit sales are normally collected as follows:* 30% in the month in which the transaction takes place, and these customers are entitled to a 5% discount.* 65% in the following monthThe rest is usually written off as bad debts.5. Budgeted purchases of inventory are as follows:December 2022 January 2023 February 2023R1 000 000 R800 000 R920 000 6. Fifty percent (50%) of the purchases are for cash. The remainder is paid in the month after the purchase.7. The monthly salaries amount to R150…
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Kupa Ltd. has approached their local banker for an overdraft facility in 2021. The banker has asked to provide a cash budget for the first six months of 2021. The company has furnished you with the following information. Oct 2020 Nov 2020 Dec. 2020 Jan. 2021 Feb. 2021 Mar. 2021 Apr. 2021 May 2021 June 2021 July 2021 Aug. 2021 Sep 2021 Sales (Sh.‘000’) 190 170 200 180 220 240 210 160 180 220 240 220 Sales are made 40% cash. Of credit sales, 30% is collected in the month of sale, 40% one month after sale and 25% two months from sales Gross profit margin is 25%. Goods purchased in a month are sold two months after the month of purchase. Purchases are paid 30% one the month of purchase and the remainder two months thereafter. Cash Overheads average 10% of the monthly sales. Cash Operating expenses are 15% of the monthly sales. New equipment costing Sh. 24,000 will, be purchased for cash in April. Annual depreciation on this…

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Requirements: Prepare the 2016 cash budget. Find out if the company will have enough cash to pay the P6-million property in the third quarter.