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An asterisk (*) will appear to the right of an incorrect entry. The essay answer will not be graded. Enter a zero in cells you would otherwise leave blank.1.MERCURY SHOES INC.Cash BudgetFor the Three Months Ending June 30, 2016June JulyEstimated cash receipts from:Cash sales$ 16,000 $ 18,500 Collections from accounts receivable138,000 146,400 Total cash receipts$ 154,000 $ 164,900 Estimated cash payments for:Manufacturing costs$ 56,200 $ 66,800 Selling and administrative expenses40,000 46,000 Capital expenditures- - Other purposes:Income tax- 24,000 Dividends- - Total cash payments$ 96,200 $ 136,800 Cash increase (decrease)$ 57,800 $ 28,100 Cash balance at beginning of month42,000 99,800 Cash balance at end of month$ 99,800 $ 127,900 Minimum cash balance40,000 40,000 Excess (deficiency)$ 59,800 $ 87,900 Supporting calculations:Collections of accounts receivable:Sales on AccountPercentageApril sales$ 120,000 40%May sales:Collected in June150,000 60%Collected in July150,000 40%June sales:Collected in July160,000 60%Collected in August160,000 40%Instructions
July sales185,000 60%Payments for manufacturing costs:Costs on AccountPercentagePaid in June:Incurred in MayIncurred in June54,000 80%TotalPaid in July:Incurred in June54,000 20%Incurred in July70,000 80%TotalPaid in August:Incurred in July70,000 20%Incurred in August93,000 80%Total2.Based on the above budget, it appears that company would be able to maintain the mbalance of $40,000 for the months of June and July. However, for the month of Augusavaiable cash balance is short by $9,000 from minimum cash balance of $40,000.
August$ 20,000 157,500 $ 177,500 $ 88,400 51,000 120,000 - 15,000 $ 274,400 $ (96,900)127,900 $ 31,000 40,000 $ (9,000) JuneJulyAugust$ 48,000 $ - $ - 90,000 - - - 60,000 - - 86,400 - - - 57,600
- - 99,900 $ 138,000 $ 146,400 $ 157,500 Payments$ 13,000 43,200 $ 56,200 $ 10,800 56,000 $ 66,800 $ 14,000 74,400 $ 88,400 minimum cash st the

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