Reference no: EM132577603

Problem 1: Cash budgeting and decision making VanTrade Inc's forecasted operations for 3rd period of 2020 is shown below. The company began July with $150,000 of cash on hand. At the end of September, company needs 150000$ cash available for fulfilling upcoming Capital Expenditure payment. Prepare cash budget, and determine how much cash will be available at the end of 3rd quarter. Is there any apparent risk associated with the required cash outflow at the end of september?

                                                                July                        August                         September

Customer receipts                                        $ 650,000               $ 700,000                   $950,000

Cash paid for direct materials                             180,000                  200,000                    245,000

Cash paid for direct labor                                    270,000                     300,000               325,000

Factory overhead                                                150,000                     155,000               164,000

SG&A                                                                    76,000                     80,000                 75,000

Taxes                                                                        15,000                  20,000                   26,000

Equipment purchase                                                         -                            -                   150,000