Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Financial Accounting Expert

Assignment

To avoid any uncertainty regarding his business' financing needs at the time when such needs may arise, Cyrus Brown wants to develop a cash budget for his latest venture: Cyrus Brown Manufacturing (CBM). He has estimated the following sales forecast for CBM over the next 9 months:

March       

$100,000

April          

$275,000

May           

$320,000

June           

$450,000

July            

$700,000

August       

$700,000

September 

$825,000

October    

$500,000

November  

$115,000

He has also gathered the following collection estimates regarding the forecast sales:

• Payment collection within the month of sale = 25%
• Payment collection the month following sales = 55%
• Payment collection the second month following sales = 20%

Payments for direct manufacturing costs like raw materials and labor are made during the month that follows the one in which such costs have been incurred. These costs are estimated as follows:

March    

$187,500

April      

$206,250

May        

$375,000

June       

$337,500

July              

$431,250

August        

$640,000

September 

$395,000

October 

$425,000

Additional financial information is as follows:

• Administrative salaries will approximately amount to $35,000 a month.
• Lease payments around $15,000 a month.
• Depreciation charges, $15,000 a month.
• A one-time new plant investment in the amount of $95,000 is expected to be incurred and paid in June.
• Income tax payments estimated to be around $55,000 will be due in both June and September.
• And finally, miscellaneous costs are estimated to be around $10,000 a month.
• Cash on hand on March 1 will be around $50,000, and a minimum cash balance of $50,000 shall be on hand at all times.

To receive full credit on this assignment, please show all work, including formulas and calculations used to arrive at the financial values.
Group Project Guidelines

• As a group, prepare a monthly cash budget for Cyrus Brown Manufacturing for the 9-month period of March through November.

o Use Excel to prepare the monthly cash budget.

• Based on your cash budget findings, answer the following questions:

o Will the company need any outside financing?
o What is the minimum line of credit that CBM will need?
o What do you think of CBM's cash position during the budget period? Do you see any concerns for the company in this regard?
o If you were a bank manager, would you want CBM as your client? Why or why not?

• It is up to the members of the group to divide the assignment tasks evenly. You will be graded on group participation

Your submitted Group Project (150 points) must include the following:

• An Excel spreadsheet that contains your group's monthly cash budget for Cyrus Brown Manufacturing.
• A double-spaced Word document of 1-2 pages that contains your answers to the questions listed in the Assignment Guidelines.

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M92100882
  • Price:- $70

Priced at Now at $70, Verified Solution

Have any Question?


Related Questions in Financial Accounting

Sweet treats common stock is currently priced at 3672 a

Sweet treats common stock is currently priced at $36.72 a share. The company just paid $2.18 per share as its annual dividend. The dividends have been increasing by 2,2 percent annually and are expected to continue doing ...

The ipl just signed sachin to a contract consisting of

The IPL just signed Sachin to a contract consisting of eight, end-of-year payments worth $9 million each, with the first payment precisely one year from today. On the other hand, Dhoni recent deal calls for six annual pa ...

Can you please help me with thishow do restrictions affect

Can you please help me with this. How do restrictions affect net assets in Not- For -Profit organization or health care?

Consider the following account starting balances and

Consider the following account starting balances and transactions involving these accounts. Use T-accounts to record the starting balances and the offsetting entries for the transactions. The starting balance of Cash is ...

Establish and maintain accounting info systems and provide

Establish and maintain accounting info systems and Provide management accounting information Assignment - Assignment 1 - Case Studies Case Study 1 - Review the case study information below and complete the steps mentione ...

Highway express has paid annual dividends of 132 133 138

Highway Express has paid annual dividends of $1.32, $1.33, $1.38, $1.40, and $1.42 over the past five years, respectively. What is the average divided growth rate?

Assignment -part a -background saturn petcare australia and

Assignment - Part A - Background: Saturn Petcare Australia and New Zealand is Australia's largest manufacturer of pet care products. Saturn have been part of the Australian and New Zealand pet care landscape since openin ...

Oil services corp reports the following eps data in its

Oil Services Corp. reports the following EPS data in its 2017 annual report (in million except per share data). Net income $1,827 Earnings per share: Basic $1.56 Diluted $1.54 Weighted average shares outstanding: Basic 1 ...

Ww productswith new productssales revenue

Without New Products With New Products Sales revenue $11,686,200 $16,263,600 Net income $486,300 $878,400 Average total assets $5,917,600 $13,539,700 (a) Compute the company's return on assets, profit margin, and asset t ...

Excel quiz1 start excel 2016 and download and open the file

Excel Quiz 1. Start Excel 2016 and download and open the file Excel Quiz1F18. 2. Save the workbook as FirstName_LastName_Excel_Quiz1 where FirstName is your own First Name and LastName is your Surname (for example Roger_ ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As