Question

Use the following information to prepare the September cash budget for PTO Co. The following information relates to expected cash receipts and cash payments for the month ended September 30.
a. Beginning cash balance, September 1, $40,000.
b. Budgeted cash receipts from sales in September, $255,000.
c. Raw materials are purchased on account. Purchase amounts are August (actual), $80,000; and September (budgeted), $110,000. Payments for direct materials are made as follows: 65% in the month of purchase and 35% in the month following purchase.
d. Budgeted cash payments for direct labor in September, $40,000.
e. Budgeted depreciation expense for September, $4,000.
f. Other cash expenses budgeted for September, $60,000.
g. Accrued income taxes payable in September, $10,000.
h. Bank loan interest payable in September, $1,000.

Answer 1

Answer:

Begining Cash               40,000

receipts from sales      255,000

payment to supplies    (104,500)

payment of wages         (40,000)

other cash expenses     (60,000)  

Ending Cash                    90,500

Explanation:

raw materials disbursment for the month of september

80,000  x 35%  =  28,000 for August purchases

110,000  x 65%  =   71,500 for September purchases

Total payment      104,500  

the depreciation and accrued expenses along with the interest payable (which are also a accrued expense) will not be included as they don't represent neither a cash inflow nor outflow.