Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements Beginning cash balance i Total cash receipts Total cash available 1st Quarter $ 280,000 $ 344,000 The company's beginning cash balance for the upcoming fiscal year will be $45,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3% The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded Required: Prepare the company's cash budget for the upcoming fiscal year. Note: Repayments, interest, and cash deficiencies should be indicated by a minus sign. Total cash disbursements Excess (deficiency) of cash available over disbursements Financing Borrowings Repayments Interest 2nd Quarter $400,000 $ 314,000 Total financing Ending cash balance 3rd Quarter $ 330,000 $ 304,000 Garden Depot Cash Budget 4th Quarter $ 350,000 $ 324,000 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year
Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements Beginning cash balance i Total cash receipts Total cash available 1st Quarter $ 280,000 $ 344,000 The company's beginning cash balance for the upcoming fiscal year will be $45,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3% The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded Required: Prepare the company's cash budget for the upcoming fiscal year. Note: Repayments, interest, and cash deficiencies should be indicated by a minus sign. Total cash disbursements Excess (deficiency) of cash available over disbursements Financing Borrowings Repayments Interest 2nd Quarter $400,000 $ 314,000 Total financing Ending cash balance 3rd Quarter $ 330,000 $ 304,000 Garden Depot Cash Budget 4th Quarter $ 350,000 $ 324,000 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter8: Budgeting
Section: Chapter Questions
Problem 3PA: Budgeted income statement and supporting budgets The budget director of Birding Homes Feeders Inc.,...
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year Management has prepared the following summary
of its budgeted cash flows:
Total cash receipts
Total cash disbursements
1st Quarter
$ 280,000
$ 344,000
Beginning cash balance
Total cash receipts
Total cash available
Total cash disbursements
Excess (deficiency) of cash available over disbursements
Financing
Borrowings
Repayments
Interest
2nd Quarter
$ 400,000
$314,000
The company's beginning cash balance for the upcoming fiscal year will be $45,000. The company requires a minimum cash balance
of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any
amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments
are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded
Required:
Prepare the company's cash budget for the upcoming fiscal year.
Note: Repayments, interest, and cash deficiencies should be indicated by a minus sign.
Total financing
Ending cash balance
3rd Quarter
$ 330,000
$ 304,000
4th Quarter
$ 350,000
$ 324,000
Garden Depot
Cash Budget
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Year
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