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Acct 504 Case 3 Study - Cash Budget

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CASE STUDY 3 - Cash Budget Template

SCHEDULE OF EXPECTED CASH COLLECTIONS FROM CUSTOMERS: Credit Sales July August September Total Cash Collections

August 12,000 14,400 26,400

SCHEDULE FOR EXPECTED PAYMENTS FOR PURCHASE OF INVENTORY Inventory purchases July August September Total Payments for Inventory Purchases

August 32,500 22,500 55,000

Oxford Company Cash Budget For the Two Months of August and September Cash balance Add: Receipts Collections from customers Sale of plant assets Sale of new common stock Cash sales Total receipts Total Available Cash Less: Disbursements Purchases of inventory Operating expenses Selling and administrative expenses Dividends Equipment purchase Total disbursements Excess (deficiency of available cash over disbursements) Financing Borrowings Repayments Ending cash balance Please answer the 3 qualitative questions on the next tab called Qualitative Questions. August $10,000 26,400 12,350 51,000 89,750 99,750 55,000 6,750 12,500 19,000 93,250 6,500

3,500 $10,000

September 9,600 10,800 20,400

September 22,500 10,500 33,000

September $10,000 20,400 16,850 39,000 76,250 86,250 33,000 6,750 12,500 6,000 58,250 28,000

(3,570) 24,430

1)

2)

3)

What are the three sections of a Cash Budget, and what is included in each section? Cash receipts section: This section includes cash that is expected to be recieved from company activity and customer payments. This includes money coming in from the sale of Cash disbursements section: This section includes cash payments expected to be made for the company to function. This includes payments for materials, labor, overhead, taxes, Financing section: This section shows the money the company is borrowing and the

Why is a Cash Budget so vital to a company? Properly managing cash is essential for any and every business. By utilizing a cash budget, a company can

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