AccountingThe following information for ABCs Projects is available: MARCHAPRILMAYJUNEJULYAUGUSTCash revenue180 000200 000250 000290 000320 000350 000Credit revenue380 000410 000500 000560 000560 000600 000Total purchases320 000340 000385 000432 000445 000460 000Salaries and wages63 00063 00063 00063 00063 00063 000Other expenses12 00012 50012 50014 50054 80059 000Additional information:Credit revenues are collected as follows:50% within 30 days (the next month)25% within 60 days15% within 30 days10% uncollectible (bad debt)The following discount is given on revenues:10% on all cash revenue5% on credit revenue paid within 30 daysSalaries, wages and other expenses are paid in cash.Other expenses include depreciation of $4 000 per month.55% of all purchases are on credit and are paid for in the following month. The rest represents cash purchases.The bank balance of ABCs Projects on 1 June is $200 000.A dividend of $3 000 will be declared on 31 August.Required:Prepare the cash budget for the months June, July and August (Use separate columns for June, July and August).

A Cash Budget is one of the various budgets prepared by the business organization. A Cash Budget is…

Answered: he following information for ABCs…

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

The following information for ABCs Projects is available:

Additional information:

1. Credit revenues are collected as follows:
  - 50% within 30 days (the next month)
  - 25% within 60 days
  - 15% within 30 days
  - 10% uncollectible (bad debt)
2. The following discount is given on revenues:
  - 10% on all cash revenue
  - 5% on credit revenue paid within 30 days
3. Salaries, wages and other expenses are paid in cash.
4. Other expenses include depreciation of $4 000 per month.
1. 55% of all purchases are on credit and are paid for in the following month. The rest represents cash purchases.
2. The bank balance of ABCs Projects on 1 June is $200 000.
3. A dividend of $3 000 will be declared on 31 August.