The cash receipts section includes expected receipts from the company

The cash receipts section includes expected receipts from the company

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
The cash receipts section includes expected receipts from the company's principal source(s) of revenue. These are usually cash sales and collections from customers on credit sales. This section also shows anticipated receipts of interest and dividends, and proceeds from planned sales of investments, plant assets, and the company's capital stock. The cash disbursements section shows expected cash payments . Such payments include direct materials, direct labor, manufacturing overhead, and selling and administrative expenses. This section also includes projected payments for income taxes, dividends, investments, and plant assets . The financing section shows expected borrowings and the repayment of the borrowed funds plus interest . Companies need this section when there is a cash deficiency or when the cash balance is below management's minimum required balance. Data in the cash budget are prepared in sequence. The ending cash balance of one period becomes the beginning cash balance for the next period
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

The cash receipts section includes expected receipts from the company

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online