Part 2
Lynbrook is also preparing its master budget for the quarter ended June 30, 2024.
Budgeted sales and cash payments for product costs for the quarter follow:
Sales are 20% cash and 80% on credit.
Lynbrook is also preparing its master budget for the quarter ended June 30, 2024. Budgeted sales and cash payments for product costs for the quarter follow:
Budgeted sales
Budgeted cash payments for
Direct materials Direct labor Factory overhead
April May $64,000 $80,000
16,160 13,440 4,040 3,360
June $48,000
13,760 3,440 17,200
(continued)
20,200 16,800 Sales are 20% cash and 80% on credit.
All credit sales are collected in the month following the sale. The March 31 balance sheet includes balances of $15,000 in cash; $45,000 in accounts receivable; $4,500 in accounts payable; and a $5,000 balance in loans payable. A minimum cash balance of $15,000 is required. Loans are obtained at the end of any month when a cash shortage occurs. interest is 1% per month (12% annual rate) based on the beginning-of-the- month loan balance and is paid at each month-end. If an excess balance of cash exists, loans are repaid at the end of the month. Operating expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($4,000 per month), and rent ($6,500 per month).
1. Prepare a cash receipts budget for April, May, and June.
2. Prepare a cash budget for each of the months of April, May, and June. (Round amounts to the nearest dollar.
Part 2
Lynbrook is also preparing its master budget for the quarter ended June 30, 2024. Budgeted sales and cash payments for product costs for the quarter follow:
April $64,000
May $80,000
June $48,000
Budgeted sales
Budgeted cash payments for
Direct materials
16,160
13,440
13,760
Direct labor
4,040
3,360
3,440
Factory overhead
20,200
16,800
17,200
Sales are 20% cash and 80% on credit.