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    Cash Budget - Renson Corporation

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    Renson Corporation, a wholesaler, provided the following information:

    Month Merchandise Purchases Sales
    January $142,000 $172,000
    February 148,000 166,000
    March 136,000 165,000
    April 154,000 178,000
    May 160,000 166,000

    Customers pay 60% of their balances in the month of sale, 30% in the month following sale, and 10% in the second month following sale. The company pays all invoices in the month following purchase and takes advantage of a 3% discount on all amounts due. Cash payments for operating expenses in May will be $119,500; Renson's cash balance on May 1 was $127,800.

    Required: Determine the following:
    A. Expected cash collections during May.
    B. Expected cash disbursements during May.
    C. Expected cash balance on May 31.

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    Solution Summary

    The solution provides cash budget for Renson Corporation in excel.