Question

Carla Vista Company expects to have a cash balance of $64,400 on January 1, 2022. These are the relevant monthly budget data for the first two months of 2022.
MAKE A CASH BUDGET

1.		Collections from customers: January $99,400, February $204,400.
2.		Payments to suppliers: January $56,000, February $105,000.
3.		Wages: January $42,000, February $56,000. Wages are paid in the month they are incurred.
4.		Administrative expenses: January $29,400, February $33,600. These costs include depreciation of $1,400 per month. All other costs are paid as incurred.
5.		Selling expenses: January $21,000, February $28,000. These costs are exclusive of depreciation. They are paid as incurred.
6.		Sales of short-term investments in January are expected to realize $16,800 in cash. Carla Vista Company has a line of credit at a local bank that enables it to borrow up to $35,000. The company wants to maintain a minimum monthly cash balance of $28,000.

Answer 1

Answer-

CARLA VISTA COMPANY
CASH BUDGET
Particulars	January	February
	$	$
Opening cash balance	64400	33600
Cash collections:-
Collection from customers	99400	204400
Sale of marketable securities	16800	0
Total cash available (A)	180600	238000
Cash disbursements:-
Payments for direct materials	56000	105000
Direct Labor	42000	56000
Manufacturing overhead excluding depreciation	28000	32200
Selling & administrative expense	21000	28000
Total cash disbursements (B)	147000	221200
Excess (deficiency) of available cash over cash disbursements	33600	16800
Add-Borrowings	0	11200
Less- Repayments	0	0
Ending cash balance	33600	28000