Question

Compute the A Cash Budget for Ba Valu Supermarkets

Month	Sales	Cash Disbursements
August	P400	P300
September	500	500
October	500	700
November	600	400
December	700	500

90% of sales are for cash, the remaining 10% are collected one month later. All disbursements are on a cash basis. The firm wishes to maintain a minimum cash balance of P50. The beginning cash balance in September is P25. Prepare a cash budget for the months of October, November, and December, noting any needed financing or excess cash available.

Answer 1

	August	September	October	November	December
Beginning balance of cash		25	50	50	190
Add:
Cash sales	360	450	450	540	630
Cash collections		40	50	50	60
Total cash available		515	550	640	880
Cash disbursements	300	500	700	400	500
Cash balance--before considering minimum balance		15	-150	240	380
Minimum desired cash balance		50	50	50	50
Cash surplus/(Deficit)		-35	-200	190	330