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    Cash Budget

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    The ABC Corporation's budgeted monthly sales are $4,000. In the first month, 40% of its customers pay and take the 3% discount.

    The remaining 60% pay in the month following the sale and don't receive a discount.
    ABC's bad debts are very small and are excluded from this analysis.

    Purchases for next month's sales are constant each month at $2,000. Other payments for wages, rent, and taxes are constant at $500 per month.

    Construct a single month's cash budget with the information given. What is the average cash gain or (loss) during a typical month for the ABC Corporation?

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    https://brainmass.com/business/cash-budgeting/cash-budget-432639

    Solution Summary

    This solution illustrates how to construct a cash budget.

    $2.19

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