00:01
So to prepare a cash budget for the month of april and may, you will need to estimate the cash flow and outflow for each month based on the given information.
00:10
So we'll start with the calculation.
00:25
First is cash flow.
00:28
Cash inflow.
00:30
For cash inflow collected from january credit sale, january 6, 2020, is 60 % credit sale, which is 198.
00:47
And february is 723 .40%, which is 288.
01:16
And the top is march, which is 555 .29%, 1649 .50.
01:35
Additional collection, if any, from previous month.
01:38
So to calculate next cash outflow, i mean cash flow calculation.
01:47
The total cash flow will be 198 plus 288 plus 16950.
02:15
Plus additional collection, which is total inflow and total cash outflow, which is 368 .550 plus 229 .408 plus 11 ,000 plus 2 ,000.
02:53
So now we calculate the ending cash balance for april.
03:04
And beginning balance plus total inflow minus total outflow.
03:13
Given that at the end of march, the business has unpaid balance of 7 ,000, 7 ,000, which is given.
03:23
You can use this as the beginning cash flow for april.
03:28
And now we will use the ending cash balance for april as the beginning cash balance for may and repeat the process.
03:40
So cash inflow, next is may cash outflow.
03:56
Cash flow, cash inflow.
04:02
February, 720 multiplied 29%, which is 208.
04:17
And march, which is 555 multiplied 29%, 1609 .50.
04:34
Cash outflow, march is 5 ,220.
04:49
5 ,220 multiplied by 45 % may sales, which is 294 .90...