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Cash Budget for Pine Mulch Company

The attached problem describes the financials for Pine Mulch Company at the end of the first quarter, with sales ending in March. Use only the information provided to complete the cash budget for the 3 months in the 2nd quarter. The first table provides the forecasted sales and expenses for the 2nd quarter. The second table is the cash budget with partially completed line items.

Discuss the approach and method that you will utilize to address this scenario. Once the cash budget has been developed, discuss whether there is a need to obtain any short term financing needed for the 2nd quarter, and planning for the 3rd quarter.


Solution Preview

Please see the attached file.

First find the total collections of each month of the quarter:

Credit sales and Collections
Second Quarter, 20X5
March April May June

Credit sales $180,000 $160,000 $140,000 $192,000

Collections of current ...

Solution Summary

The solution explains how to prepare a cash budget