Cash Budget for Congo Limited

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  • Topic: Management, Project management, Cash flow
  • Pages : 4 (1151 words )
  • Download(s) : 65
  • Published : February 7, 2013
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CASH BUDGET FOR CONGO LIMITED|
| FEBRUARY
$’000| MARCH
$’000| APRIL
$’000| Total $’000|
Cash On Hand| 1,800| 3,568| 2,805| 8,173|
| | | | |
Cash Receipts| | | | |
Cash Sales| 1,850| 1,620| 1,400| 4,870|
Collections from CR Accounts| 13,110| 11,875| 10,545| 35,530| Total Cash Receipts| 14,960| 13,495| 11,945| 40,400|
Total Cash Available| 16,760| 17,063| 14,750| 48,573|
| | | | |
Cash Paid Out| | | | |
Purchases Resale| (7,742)| (8,232)| (7,546)| (23,520)| Salaries and Wages| (3,200)| (3,100)| (3,000)| (9,300)| Overhead Expenses| (2,250)| (2,600)| (2,950)| (7,800)| Two New Vans ($150,000 Each)| | | (300)| (300)|

Taxation| | (326)| | (326)|
Total cash paid out| (13,192)| (14,258)| (13,796)| (41,246)| Cash Position | 3,568| 2,805| 954| 7,327|
| | | | |
Essential Operating Data (non-cash flow information)| | | | | Bad Debt (end of the month)| 690| 625| 555| |
Discount| 158| 168| 154| |
Depreciation| 250| 250| 250| |

I agree with the statement “Budgeting is a key component in management short and long term planning”. Budgeting is a financial planning that helps the organisation to have control of their spending in the business. The main objective of a business is to maximize profit by using the minimum cost. A good planning on budget may prevent the organisation from overspending their limited capital into one investment. As mentioned above, organisations have limited capital to be invested in fixed asset or working capital, therefore organisations need to prepare a budget in order for them to keep track on how the organisations spend their limited capital and did the organisation and if each Ringgit spent has been fully utilized. Budgeting is important especially for the small or medium size organisation which could not afford to waste any money on any investments that are not worth the price....
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