Reference no: EM13581197

At the beginning of the 2014 school year, Britney Logan decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:

Cash balance, September 1 (from a summer job)	$7,940
Purchase season football tickets in September	110
Additional entertainment for each month	270
Pay fall semester tuition in September	4,300
Pay rent at the beginning of each month	380
Pay for food each month	220
Pay apartment deposit on September 2 (to be returned December 15)	500
Part-time job earnings each month (net of taxes)	980

a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign. Britney Logan Cash Budget For the Four Months Ending December 31, 2014 September October November December Estimated cash receipts from: Part-time job $ $ $ $ Deposit Total cash receipts $ $ $ $ Estimated cash payments for: Season football tickets $ Additional entertainment $ $ $ Tuition Rent Food Deposit Total cash payments $ $ $ Cash increase (decrease) $ $ $ $ Cash balance at beginning of month Cash balance at end of month $ $ $ $

Hide Feedback

Correct

Check My Work Feedback

Sometimes an item may be a decrease in one period and an increase in a different period.

Review the definitions of static budgets and flexible budgets.

What weaknesses are shown by this cash budget?

Learning Objective 5.

b. Are the four monthly budgets that are presented prepared as static budgets or flexible budgets?

c. Logan can see that her present plan sufficient cash. If Logan did not budget but went ahead with the original plan, she would be $ ______???????at the end of December, with no time left to adjust.