Precision Machines Part 2
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precision_machines_part_2.xlsCapital Budgeting
| Precision Machines | |||||||||
| Student Note: Fill in the light yellow cells | |||||||||
| Data: | |||||||||
| November | December | January | February | March | April | May | June | ||
| Annual Cost of borrowing | 10.00% | ||||||||
| Minimum Cash Balance | $5,000.00 | ||||||||
| Beginning Cash Balance | $7,500.00 | ||||||||
| Revenues (Sales) | $40,000.00 | $50,000.00 | $48,000.00 | $55,000.00 | $35,000.00 | $50,000.00 | $65,000.00 | $40,000.00 | |
| Cash Collections | November | December | January | February | March | April | May | June | |
| First Month (30%) | $12,000.00 | $15,000.00 | $14,400.00 | $16,500.00 | $10,500.00 | $15,000.00 | $19,500.00 | $12,000.00 | |
| Second Month (35%) | 14,000.00 | 17,500.00 | 16,800.00 | 19,250.00 | 12,250.00 | 17,500.00 | 22,750.00 | ||
| Third Month (35%) | 14,000.00 | 17,500.00 | 16,800.00 | 19,250.00 | 12,250.00 | 17,500.00 | |||
| Total Collections | $45,900.00 | $50,800.00 | $46,550.00 | $46,500.00 | $49,250.00 | $52,250.00 | |||
| Cash Disbursements | |||||||||
| Material Purchases | $20,000.00 | $25,000.00 | $24,000.00 | $27,500.00 | $17,500.00 | $25,000.00 | $32,500.00 | ||
| Salaries | 6,000.00 | 6,000.00 | 6,000.00 | 6,000.00 | 6,000.00 | 6,000.00 | |||
| Wages | 3,000.00 | 3,500.00 | 3,000.00 | 3,200.00 | 3,500.00 | 3,000.00 | |||
| Other Expenses | |||||||||
| Capital Expenditure | 45,000.00 | ||||||||
| Dividends | 1,000.00 | 1,000.00 | |||||||
| Interest | 425.00 | ||||||||
| Total Disbursements | $34,000.00 | $33,500.00 | $82,500.00 | $27,125.00 | $34,500.00 | $42,500.00 | |||
| Cash flows | |||||||||
| Net cash flows | $11,900.00 | $17,300.00 | ($35,950.00) | $19,375.00 | $14,750.00 | $9,750.00 | |||
| Cumulative cash flows | $19,400.00 | $36,700.00 | $750.00 | $15,125.00 | $29,875.00 | $39,625.00 | |||
| Minimum Cash Balance | $5,000.00 | $5,000.00 | $5,000.00 | $5,000.00 | $5,000.00 | $5,000.00 | |||
| Cash Surplus or (Deficit) | $14,400.00 | $31,700.00 | ($4,250.00) | $5,875.00 | $24,875.00 | $34,625.00 | |||
| Recommendations: |
