ACME Company

Cash Budget for July to December 2016

MAY JUNE JULY AUGUST SEPTEMBER

Sales forecast 300,000 290,000 425,000 500,000 600,000

Cash Sales (0.12) 36,000 34,800 51,000 60,000 72,000
Less: Discount (0.03) 1,080 1,044 1,530 1,800 2,160
Collections of AR:
Lagged 1 month (0.75) 225,000 217,500 318,750 375,000
Lagged 2 months (0.13) 39,000 37,700 55,250
Other Cash Receipts - - - - -
Total Cash Receipts 34,920 258,756 305,970 414,650 500,090

Purchases (0.60 x sales) 174,000 255,000 300,000 360,000 375,000

Cash Purchases - - - - -
Payments of AP:
Lagged 1 month (100%) 174,000 255,000 300,000 360,000
Wages & Salaries 25,500 30,000 36,000
Rent Payments 8,500 10,000 12,000
Advertising Expenses 12,750 15,000 18,000
R&D Expenditures 60,000 72,000
Insurance
Other Expenses 15,000 20,000 25,000
Tax Payments 40,000
Total Cash Disbursement 0 174,000 316,750 435,000 563,000

JULY AUGUST SEPTEMBER

Total Cash Receipts 305,970 414,650 500,090
Less: Total Cash Disbursements 316,750 435,000 563,000
Net Cash Flow -10780 -20350 -62910
Add: Beginning cash 15,000 4220 -16,130
 Ending Cash 4220 -16130 -79040
Less: Minimum Cash Balance 15,000 15,000 15,000
Required total financing -10780 -31130 -94040
Excess cash balance

The cash budget of ACME Company shows that in order to maintain a 15,000 cash balance, it will have to borrow fu
shows that ACME Company will have an excess cash balance of 70,870 in November and 115,100 i
OCTOBER NOVEMBER DECEMBER
625,000 650,000 700,000
75,000 78,000 84,000
2,250 2,340 2,520

450,000 468,750 487,500

65,000 78,000 81,250
- - -
587,750 622,410 650,230

390,000 420,000 0
- - -

375,000 390,000 420,000

37,500 39,000 42,000
12,500 13,000 14,000
18,750 19,500 21,000
75,000
24,000
30,000 35,000 40,000
45,000
548,750 496,500 606,000

OCTOBER NOVEMBER DECEMBER

587,750 622,410 650,230
548,750 496,500 606,000
39000 125910 44230
-79,040 -40,040 85870
 -40040 85870 130100
15,000 15,000 15,000
-55040
70870 115100

, it will have to borrow funds in July to October. It also

November and 115,100 in December.