Acct 504 Week 3 Cash Budgeting Paper
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) | …show more content…
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. Furthermore, a structured budget must be able to provide information of where the cash will be spent on and how the organisation gathered the sufficient amount of capital for future investment. It is important to keep track on the organisation’s cash flow as it provides important information on how much money available within the organisation. Insufficient cash flow within the organisation may lead to financial distress or worst, bankruptcy. However, too much cash flow within the company is not good either as the money should be used to invest into profitable projects rather than keeping within the company. Budgeting helps the organisation to prepare sufficient amount of cash flow within the company to help dealing with day-to-day expenses, at the same time, fully utilised the excess capital in profitable …show more content…
Budget planning also helps manager to have easy access to review each project’s profitability to help in decision making if there is any loss making projects to be terminated. Budgeting increase the control of the managers within the organisation so that the manager could ensure the organisation is on the right track in achieving future goals and
$’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) | …show more content…
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. Furthermore, a structured budget must be able to provide information of where the cash will be spent on and how the organisation gathered the sufficient amount of capital for future investment. It is important to keep track on the organisation’s cash flow as it provides important information on how much money available within the organisation. Insufficient cash flow within the organisation may lead to financial distress or worst, bankruptcy. However, too much cash flow within the company is not good either as the money should be used to invest into profitable projects rather than keeping within the company. Budgeting helps the organisation to prepare sufficient amount of cash flow within the company to help dealing with day-to-day expenses, at the same time, fully utilised the excess capital in profitable …show more content…
Budget planning also helps manager to have easy access to review each project’s profitability to help in decision making if there is any loss making projects to be terminated. Budgeting increase the control of the managers within the organisation so that the manager could ensure the organisation is on the right track in achieving future goals and