Question

Pletcher Dental Clinic is a medium-sized dental service specializing in family dental care. The clinic is currently preparing the master budget for the first 2 quarters of 2020. All that remains in this process is the cash budget. The following information has been collected from other portions of the master budget and elsewhere.

Beginning cash balance		$36,600
Required minimum cash balance		30,500
Payment of income taxes (2nd quarter)		4,880
Professional salaries:
1st quarter		170,800
2nd quarter		170,800
Interest from investments (2nd quarter)		8,540
Overhead costs:
1st quarter		93,940
2nd quarter		122,000
Selling and administrative costs, including
$2,440 depreciation:
1st quarter		61,000
2nd quarter		85,400
Purchase of equipment (2nd quarter)		61,000
Sale of equipment (1st quarter)		14,640
Collections from clients:
1st quarter		286,700
2nd quarter		463,600
Interest payments (2nd quarter)		244

Prepare a cash budget for each of the first two quarters of 2020.

Answer 1

			Pletcher Dental Clinic
			Cash Budget
		For the Quarters Ending June 30,2017
				1st	2nd
				Quarter	Quarter
Beginning cash balance				36,600	30,500
Add:Receipts
Collection from Clients				286,700	463,600
Sale of Equipment				14,640	0
Investment Interest				0	8,540
total Receipts				301,340	472,140
total cash available				337,940	502,640
less:disbursements
professional salaries				170,800	170,800
payment of income taxes				0	4,880
Selling & administrative costs				58560	82960
Equipment purchase				0	61,000
overhead costs				93,940	122,000
total Disbursement				323,300	441,640
Excess(Deficiency)of cash available				14,640	61,000
financing:
Borrowing		(30500-14640)		15860	0
less:Repayments		(244+15860))		0	16104
ending cash balance				30,500	44,896