Question

Personal Budget

At the beginning of the 2016 school year, Britney Logan decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:

Cash balance, September 1 (from a summer job)	$7,530
Purchase season football tickets in September	100
Additional entertainment for each month	260
Pay fall semester tuition in September	4,100
Pay rent at the beginning of each month	360
Pay for food each month	200
Pay apartment deposit on September 2 (to be returned December 15)	500
Part-time job earnings each month (net of taxes)	930

a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.

Britney Logan
Cash Budget
For the Four Months Ending December 31, 2016
	September	October	November	December
Estimated cash receipts from:
Part-time job	$	$	$	$
Deposit
Total cash receipts	$	$	$	$
Estimated cash payments for:
Season football tickets	$
Additional entertainment		$	$	$
Tuition
Rent
Food
Deposit
Total cash payments	$	$	$	$
Cash increase (decrease)	$	$	$	$
Cash balance at beginning of month
Cash balance at end of month	$	$	$	$

b. Are the four monthly budgets that are presented prepared as static budgets or flexible budgets?

c. Brittany can see that her present plan sufficient cash. If Logan did not budget but went ahead with the original plan, she would be $ at the end of December, with no time left to adjust.

Answer 1

1-	Britney Logan
	Cash Budget
	For the Four Months Ending December 31, 2016
		September	October	November	December
	Estimated cash receipts from:
	Part-time job	930	930	930	930
	Deposit	0			500
	Total cash receipts	930	930	930	1430
	Estimated cash payments for:
	Season football tickets	100
	Additional entertainment	260	260	260	260
	Tuition	4100
	Rent	360	360	360	360
	Food	200	200	200	200
	Deposit	500
	Total cash payments	5520	820	820	820
	Cash increase (decrease)	-4590	110	110	610
	Cash balance at beginning of month	7530	2940	3140	3250
	Cash balance at end of month	2940	3140	3250	3860
2-	it is a static budget
3-	Shortage of funds	4100-3860	240