Name: Zaid Kushaal Dean

Student ID : S11207407
Camus/School : Laucala

Q1a Expected Collections from Customers

Sales May June
May 420,000 308,700 105,000
June 560,000 411,600
July 512,000
Total $ 1,492,000 $ 308,700 $ 516,600

Q1b Expected Payments for direct materials

Purchases May June
May 275,000 165,000 110,000
June 285,000 171,000
July 310,000
Total $ 870,000 $ 165,000 $ 281,000

Q3a
Paragrapgh 1

Firstly, the company needs to increase its cash sale. Cash sale has declined for July compared to June. T
Secondly, the company needs to look into minimizing its cost structure especially in the area of variable
Lastly, the company can negotiate further credit terms with its suppliers to further ease its cash flow pro

Q3b
Paragraph 2
The company is not in a position to invest in a delivery truck based current cash flow. However, if the u
a financial instituion in funding the purchase of the delivery truck which would give the campany more
m Customers Q2
July Aug Cash Budget of Donut Treats for June and July 2020
June
140,000 Cash beginning balance 70,407
376,320 128,000 Add Receipts
$ 516,320 $ 128,000 Cash Sales 411,600
Receipts from Debtors 105,000
Sale of old freezer -
rect materials Donation Received 4,000
July Aug Total Receipts 520,600

114,000 Cash Available 591,007

186,000 124,000 Less Payments
$ 300,000 $ 124,000 Cash Purchases 171,000
Payments to Creditors 110,000
Direct labor 170,000
Selling & admin exp 185,000
Manufacturing overhead 150,000
Equipment Purchases -
Total Purchases 786,000
Cash balance at end -$ 194,993

ly compared to June. This reflects the company is not doing the required volume of sale which should be able to cover its inc
y in the area of variable costing. Its a cause of concern that though the sales decreased for July the related oparational cost hav
r ease its cash flow problem.

flow. However, if the usage of the delivery vehicle will incresase the cash sale it is advisable that the company to approach
ive the campany more the ample time to pay off its loan.
June and July 2020
July
- 194,993

376,320
140,000
6,000

522,320

327,327

186,000
114,000
185,000
195,000
165,000
20,000
865,000
-$ 537,673

ich should be able to cover its increasing cost

ly the related oparational cost have shown an increase.

e that the company to approach