Cruises, Inc. has budgeted sales revenues as follows:June$135,00090,000$225,000Credit salesCash salesTotal salesJuly$125,000255,000$380,000August$ 90,000195,000$285,000Past experience indicates that 60% of the credit sales will be collected in the month of sale andthe remaining 40% will be collected in the following month. Purchases of inventory are all oncredit and 50% is paid in the month of purchase and 50% in the month following purchase.Budgeted inventory purchases are:JuneJulyAugust$300,000240,000105,000Other cash disbursements budgeted: (a) selling and administrative expenses of $48,000 eachmonth, (b) dividends of $103,000 will be paid in July, and (c) purchase of equipment in Augustfor $30,000 cash.The company wishes to maintain a minimum cash balance of $50,000 at the end of each month.The company borrows money from the bank at 6% interest if necessary to maintain theminimum cash balance. Borrowed money is repaid in months when there is an excess cashbalance. The beginning cash balance on July 1 was $50,000. Assume that borrowed money inthis case is for one month.InstructionsPrepare a cash budget for the months of July and August. Prepare separate schedules forexpected collections from customers and expected payments for purchases of inventory.Please follow the format in the next page for answering this questionCRUISES, INC.Cash BudgetFor the Two Months of July and AugustJulyBeginning cash balanceAdd: ReceiptsCollections from customersCash salesTotal receiptsTotal available cashLess: DisbursementsPurchasesSelling and administrative expensesDividendsEquipment purchaseTotal disbursementsExcess (deficiency) of available cash over disbursementsFinancingBorrowingsRepaymentsEnding cash balanceAugust
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more