[The following information applies to the questions displayed below.] Built-Tight is preparing its master budget. Budgeted sales and cash payments follow. Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead July $ 54,000 15,160 3,040 19,200 $ 70,000 12,440 2,360 15,800 September $ 58,000 12,760 2,448 16,200 Sales to customers are 15% cash and 85% on credit. Sales in June were $51,500. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $55,000 in cash and $4,000 in loans payable. A minimum cash balance of $55,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $55.000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $55.000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,000 per month), and rent ($5,500 per month). 2. Prepare a cash budget for the months of July, August, and September (Negative balances and Loan repayment amounts (if any) should be Indicated with minus sign. Enter your final answers in whole dollars.)
[The following information applies to the questions displayed below.] Built-Tight is preparing its master budget. Budgeted sales and cash payments follow. Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead July $ 54,000 15,160 3,040 19,200 $ 70,000 12,440 2,360 15,800 September $ 58,000 12,760 2,448 16,200 Sales to customers are 15% cash and 85% on credit. Sales in June were $51,500. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $55,000 in cash and $4,000 in loans payable. A minimum cash balance of $55,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $55.000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $55.000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,000 per month), and rent ($5,500 per month). 2. Prepare a cash budget for the months of July, August, and September (Negative balances and Loan repayment amounts (if any) should be Indicated with minus sign. Enter your final answers in whole dollars.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required Information
[The following information applies to the questions displayed below.]
Built-Tight is preparing its master budget. Budgeted sales and cash payments follow.
Budgeted sales
Budgeted cash payments for
Direct materials
Direct labor
Overhead
July
$ 54,000
15,160
3,040
19,200
August
$ 70,000
12,440
2,360
15,800
September
$ 58,000
12,760
2,440
16,200
Sales to customers are 15% cash and 85% on credit. Sales in June were $51,500. All credit sales are collected in the
month following the sale. The June 30 balance sheet includes balances of $55,000 in cash and $4,000 in loans payable.
A minimum cash balance of $55,000 is required. Loans are obtained at the end of any month when the preliminary cash
balance is below $55,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each
month-end. Any preliminary cash balance above $55.000 is used to repay loans at month-end. Expenses are paid in the
month incurred and consist of sales commissions (10% of sales), office salaries ($3,000 per month), and rent ($5,500 per
month).
2. Prepare a cash budget for the months of July, August, and September. (Negative balances and Loan repayment amounts (if any)
should be indicated with minus sign. Enter your final answers in whole dollars.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffe9e6d95-db01-4bc9-88bc-e685094dece8%2Fa7dc0be3-a82b-4f28-bbe1-77b5cb574c9b%2Fzmoaat6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required Information
[The following information applies to the questions displayed below.]
Built-Tight is preparing its master budget. Budgeted sales and cash payments follow.
Budgeted sales
Budgeted cash payments for
Direct materials
Direct labor
Overhead
July
$ 54,000
15,160
3,040
19,200
August
$ 70,000
12,440
2,360
15,800
September
$ 58,000
12,760
2,440
16,200
Sales to customers are 15% cash and 85% on credit. Sales in June were $51,500. All credit sales are collected in the
month following the sale. The June 30 balance sheet includes balances of $55,000 in cash and $4,000 in loans payable.
A minimum cash balance of $55,000 is required. Loans are obtained at the end of any month when the preliminary cash
balance is below $55,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each
month-end. Any preliminary cash balance above $55.000 is used to repay loans at month-end. Expenses are paid in the
month incurred and consist of sales commissions (10% of sales), office salaries ($3,000 per month), and rent ($5,500 per
month).
2. Prepare a cash budget for the months of July, August, and September. (Negative balances and Loan repayment amounts (if any)
should be indicated with minus sign. Enter your final answers in whole dollars.)
Transcribed Image Text:Required information
Beginning cash balance
Total cash available
Less: Cash payments for
Total cash payments
Preliminary cash balance
Loan activity
Additional loan
Repayment of loan to bank
Ending cash balance
Loan balance - Beginning of month
Additional loan (loan repayment)
Loan balance - End of month
July
Loan balance
July
August
August
0
0
September
September
0
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