I too assumed that they have $50K cash at the beginning of each quarter.
And I also calculated it based off 3% (12 / 3).
Ending Cash Balance
How did you come up with your cash dispursements for the first quarter? Here is what I came up with.
Salaries = $1,725,000
Capital Acquisitions = $500,000
Rent = $75,000
Total = $2,300,000
Amount to Borrw = $487,000
For some reason we have a $128,000 difference?
Supplies are missing from this calculation. This is the amount of the 4th quarter supplies. Since we are told that the
supplies are paid a quarter after they are expensed we should use the 4th qtr expenses to estimate 1st qtr payments.
That's what I figured was missing based on the amount. However, I assumed those purchases were for the
coming year, not the current. Therefore, I did not include a supplies expense in the first quarter. I guess they are
purchased in both years.
Should these parts be done as the revenues are earned or as they are collected (cash or
accrual)? For right now I have done them as the revenues are earned, but I just want to make sure I don't get to
the next step to realize I've done it wrong.
I had troubles with these too. I thought it was where I should do the lag calculations and it wasn't that's on E1c.
I think and so did the group I worked with today thought.
A) it is straight forward.
...the % * the the net revenues
all to be used in E1c.
Does anyone else agree or disagree?
This is what I thought too, but it's exactly the same information on both sheets? And also, all the numbers are
the same because the current year is the same as the budgeted year? (from the info on page 112)
Yes, I think that that is right.