The Fraley Corporation,a merchandising firm,has planned the following sales for the next four months: Sales are made 40% for cash and 60% on account.From experience,the company has learned that a month's sales on account are collected according to the following pattern: The company requires a minimum cash balance of $4,000 to start a month.
Required:
a.Compute the budgeted cash receipts for June.
b.Assume the following budgeted data for June: Using this data,along with your answer to part (a)above,prepare a cash budget for June.Clearly show any borrowing needed during the month.The company can borrow in any dollar amount,but will not pay any interest until the following month.

Question

The Fraley Corporation,a merchandising firm,has planned the following sales for the next four months:  Sales are made 40% for cash and 60% on account.From experience,the company has learned that a month's sales on account are collected according to the following pattern:  The company requires a minimum cash balance of $4,000 to start a month.
Required:
a.Compute the budgeted cash receipts for June.
b.Assume the following budgeted data for June:  Using this data,along with your answer to part (a)above,prepare a cash budget for June.Clearly show any borrowing needed during the month.The company can borrow in any dollar amount,but will not pay any interest until the following month.

Quizplus · Accepted Answer

The Answer of The Fraley Corporation,a merchandising firm,has planned the following sales for the next four months:  Sales are made 40% for cash and 60% on account.From experience,the company has learned that a month's sales on account are collected according to the following pattern:  The company requires a minimum cash balance of $4,000 to start a month.
Required:
a.Compute the budgeted cash receipts for June.
b.Assume the following budgeted data for June:  Using this data,along with your answer to part (a)above,prepare a cash budget for June.Clearly show any borrowing needed during the month.The company can borrow in any dollar amount,but will not pay any interest until the following month.

The Fraley Corporation,a Merchandising Firm,has Planned the Following Sales for the Next