Cash Budgeting Examples.

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Cash BudgetQuartersParticulars 1 2 3 4CASH INFLOWS:Collection from debtorsFrom Current sales (2/3 of quarter'5,000 7,000 12,000 7,000From Prior sales (1/3 of the last qu3,000 2,500 3,500 6,000

Total Cash Inflows during the y 8,000 9,500 15,500 13,000

CASH OUTFLOWS:Production cost 7,000 10,000 8,000 8,500Selling and Administrative cost 1,000 2,000 2,900 1,600Purchases of plant and other fixed a 100 1,100 2,100 2,100

Total Cash Outflow during the y 8,100 13,100 13,000 12,200

Surplus / (Difficiency) (100) (3,600) 2,500 800Add: Cash (at start) 650 550 500 500Balance 550 (3,050) 3,000 1,300Borrowing made during the year - 3,550 -Payment of Loan - - (2,500) (800)

Ending Cash in hand 550 500 500 500

Borrowing = Negative balance + Desired ending cash balance.Payment of loan = Surplus cash - Desired ending cash balance.1 Minimum required cash balance 5002 Cash at start of the year 650

Q1 Q2 Q3 Q4

a Cash inflow during the year 8,000 9,500 15,500 13,000b Cash outflow during the year 8,100 13,100 13,000 12,200Surplus / (Deficiency) (100) (3,600) 2,500 800c add: Cash (at start) 650 550 500 500Balance of cash 550 (3,050) 3,000 1,300d add: Borrowing during the period - 3,550e less: Repayment of loan - - 2,500 800Balance / Required cash (at end) 550 500 500 500

Borrowing = Negative balance + Required cash

Total

46,00046,400(400)6502503,5503,300500

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