Danner Company expects to have a cash balance of $55,800 on January 1, 2020. Relevant monthly budget data for the first 2 months of 2020 are as follows. Collections from customers: January $105,400, February $186,000. Payments for direct materials: January $62,000, February $93,000. Direct labor: January $37,200, February $55,800. Wages are paid in the month they are incurred, Manufacturing overhead: January $26,040, February $31,000. These costs include depreciation of $1,860 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $18,600, February $24,800. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $14,880 in cash. Danner Company has a line of credit at a local bank that enables it to borrow up to $31,000. The company wants to maintain a minimum monthly cash balance of $24,800. Prepare a cash budget for January and February Beginning Cash Balance Add O DANNER COMPANY Cash Budget $ O January February SL
Danner Company expects to have a cash balance of $55,800 on January 1, 2020. Relevant monthly budget data for the first 2 months of 2020 are as follows. Collections from customers: January $105,400, February $186,000. Payments for direct materials: January $62,000, February $93,000. Direct labor: January $37,200, February $55,800. Wages are paid in the month they are incurred, Manufacturing overhead: January $26,040, February $31,000. These costs include depreciation of $1,860 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $18,600, February $24,800. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $14,880 in cash. Danner Company has a line of credit at a local bank that enables it to borrow up to $31,000. The company wants to maintain a minimum monthly cash balance of $24,800. Prepare a cash budget for January and February Beginning Cash Balance Add O DANNER COMPANY Cash Budget $ O January February SL
Accounting Information Systems
11th Edition
ISBN:9781337552127
Author:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Publisher:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Chapter2: Enterprise System
Section: Chapter Questions
Problem 11RQ: Describe the six steps in the order-to-cash process.
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:Danner Company expects to have a cash balance of $55,800 on January 1, 2020. Relevant monthly budget data for the first 2 months
of 2020 are as follows.
Collections from customers: January $105,400, February $186,000
Payments for direct materials: January $62,000, February $93,000.
Direct labor: January $37,200, February $55,800. Wages are paid in the month they are incurred.
Manufacturing overhead: January $26,040, February $31.000. These costs include depreciation of $1,860 per month. All other
overhead costs are paid as incurred.
Selling and administrative expenses: January $18,600, February $24,800. These costs are exclusive of depreciation. They are paid as
incurred.
Sales of marketable securities in January are expected to realize $14,880 in cash. Danner Company has a line of credit at a local bank
that enables it to borrow up to $31,000. The company wants to maintain a minimum monthly cash balance of $24,800.
Prepare a cash budget for January and February.
Beginning Cash Balance
Add O
DANNER COMPANY
Cash Budget
O
0 0
O
January
$
February
SUP
Transcribed Image Text:Question 4 of 20
Beginning Cash Balance
Add
O
O
10
O
O
O
10
O
0
0
O
O
O
0
10
$
-/7.5 E
***
SUPPOR
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