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Glenny’s Glassworks prepares an annual CASH Budget by quarter and uses the following information to estimate...

  1. Glenny’s Glassworks prepares an annual CASH Budget by quarter and uses the following information to estimate the Cash Budget:

On Jan 1, 2020 the Cash Balance is expected to be $47,000.00 and they want a minimum ending balance in cash in any quarter to be $25,000.

2020 Sales are expected as follows:

1st Q                 $275,000

2nd Q                $330,000

3rd Q                 $280,000

4th Q                 $240,000As

75% of Sales are expected to be collected in the quarter they are made and the remaining 25% in the following Quarter. The 4th Q 2019 Sales were $165,000.

REQUIRED:

  1. Prepare the Cash Receipts Budget by Quarter for 2020.
  2. If Glenny spends $1,200,000 in Cash Disbursements during 2020, what would their ending Cash Balance be at Dec 31, 2020? Would they need to borrow any money to maintain their minimum cash requirement?

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please comment for any clarification . Kindly upvote.

ekkarill92 answered 1 year ago
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