Prepare a cash budget for the first quarter

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Pink Martini Corporation is projecting a cash balance of $30,000 in its December 31, 2019, balance sheet. Pink Martini's schedule of expected collections from customers for the first quarter of 2020 shows total collections of $180,000. The schedule of expected payments for direct materials for the first quarter of 2020 shows total payments of $41,000. Other information gathered for the first quarter of 2020 is as follows: sale of equipment $5,000; direct labour $72,000, manufacturing overhead $38,000; selling and administrative expenses $44,000; and purchase of securities $14,000. Pink Martini wants to maintain a balance of at least $22,000 cash at the end of each quarter.

Problem 1: Prepare a cash budget for the first quarter.

Reference no: EM132946510

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