Prepare cash budget for the period

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Reference no: EM131878338

Cher Inc wants you to forecast their cash flows for Jan to March 2018.

Sales: Nov 2017 $150,000

Dec 2017 $100,000

January 2018 $120,000

Feb 2018 $90,000

March 2018 $215,000

April 2018 $150,000

Sales are 50% on credit and 1/2 are collected the month after the sale. 1/2 the second month after sale and 50% of the monthly sales are for cash and collected during the month of sale

COGS is 50% of the current month sales but paid for onemonth in advance

Fixed expenses: monthly rent is $20,000

monthly payroll is $15,000

sales tac due in JAN $1,500

beg cash is $20,000 which is the company required cash level. any amount borrwed in given month will pay interest at 1% per month the month following the month borrwed. excess cash will not earn interest

Prepare cash budget for the period from january to march 2018.

Reference no: EM131878338

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