BU121 Lecture 12: Lecture 12 Feb 13
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Worksheet based on historical measures of amounts and timing of cash flows / what is typical in industry. You need t prepare a cash budget for the months of june, july and august. Assu(cid:373)e that pu(cid:396)(cid:272)hases a(cid:396)e 75% of the (cid:374)e(cid:454)t (cid:373)o(cid:374)th"s sales. Assume also that you pay for 20% of purchases in the month of purchase, and 80% in the month following. If do(cid:374)"t e(cid:374)di(cid:374)g (cid:271)ala(cid:374)(cid:272)e = total e(cid:454)(cid:272)ess. You need to prepare a cash budget for the months of june, july and august. Beginning cash balance in june = min. cash balance. Assume that sales are forecasted at , , , , , and from. Assume also that you expect to collect 30% in month of sale, 60% in month following sale, and. Assume that purchases a(cid:396)e 75% of the (cid:374)e(cid:454)t (cid:373)o(cid:374)th"s sales (based on your cost of goods sold (vcrr) and lead time from order to delivery)
