Group Member	Contact	Group Work Submissions
Strickland, Elizabeth	[email protected]	No submissions
Johnson, Shikia	[email protected]	No submissions
Miller, Haley	No Longer Active	No submissions

Assignment Description

Please read the relevant parts of your textbook, which refer to cash flow and financial planning.

To avoid any uncertainty regarding his business' financing needs at the time when such needs may arise, Cyrus Brown wants to develop a cash budget for his latest venture: Cyrus Brown Manufacturing (CBM). He has estimated the following sales forecast for CBM over the next 9 months:

March	$100,000
April	$275,000
May	$320,000
June	$450,000
July	$700,000
August	$700,000
September	$825,000
October	$500,000
November	$115,000

He has also gathered the following collection estimates regarding the forecast sales:

· Payment collection within the month of sale = 25%

· Payment collection the month following sales = 55%

· Payment collection the second month following sales = 20%

Payments for direct manufacturing costs like raw materials and labor are made during the month that follows the one in which such costs have been incurred. These costs are estimated as follows:

March	$187,500
April	$206,250
May	$375,000
June	$337,500
July	$431,250
August	$640,000
September	$395,000
October	$425,000

Additional financial information is as follows:

· Administrative salaries will approximately amount to $35,000 a month.

· Lease payments around $15,000 a month.

· Depreciation charges, $15,000 a month.

· A one-time new plant investment in the amount of $95,000 is expected to be incurred and paid in June.

· Income tax payments estimated to be around $55,000 will be due in both June and September.

· And finally, miscellaneous costs are estimated to be around $10,000 a month.

· Cash on hand on March 1 will be around $50,000, and a minimum cash balance of $50,000 shall be on hand at all times.

To receive full credit on this assignment, please show all work, including formulas and calculations used to arrive at the financial values.

Group Project Guidelines

· As a group, prepare a monthly cash budget for Cyrus Brown Manufacturing for the 9-month period of March through November.

· Use Excel to prepare the monthly cash budget.

· Based on your cash budget findings, answer the following questions:

· Will the company need any outside financing?

· What is the minimum line of credit that CBM will need?

· What do you think of CBM's cash position during the budget period? Do you see any concerns for the company in this regard?

· If you were a bank manager, would you want CBM as your client? Why or why not?

· It is up to the members of the group to divide the assignment tasks evenly. You will be graded on group participation

Your submitted Group Project (150 points) must include the following:

· 75 Points. An Excel spreadsheet that contains your group's monthly cash budget for Cyrus Brown Manufacturing.

· 75 Points. A double-spaced Word document of 1–2 pages that contains your answers to the questions listed in the Assignment Guidelines.

Grading

You will be graded on the accuracy of your monthly cash budget and your demonstrated understanding of financial analysis procedures. You will also be graded on your group participation.

Please add your file.

For assistance with your assignment, please use your text, Web resources, and all course materials.

Grading Criteria	Percentage
Deliverable requirements addressed; understanding of material and writer's message and intent are clear.	40%
Calculation methods, where required, are contextually appropriate, fully explained, and presented in a manner that is easy to understand.	10%
External research incorporated in the paper, if any, supports the writer's position properly acknowledged and cited; direct quotations may not exceed 10% of the word count of the body of the assignment deliverable (excluded title page, abstract or table of contents if used, tables, exhibits, appendices, and reference page(s).) Inclusion of plagiarized content will not be tolerated and may result in adverse academic consequences.	5%
Critical thinking: Position is well-justified; logical flow; examples provided where appropriate.	20%
Structure: Includes introduction and conclusion; proper paragraph format; reads as a polished academic paper or professional presentation, as appropriate for the required assignment deliverable.	10%
Mechanical: No spelling, grammatical, or punctuation errors.	10%
APA: Deliverable is cited properly according to the APA Publication Manual (6th ed.).	5%

Other Information

Instructions:

Instructions for the group project

For the group project, I think the best way to divide the work is by sections: one person to do the inflow and the outflow, one or two do the summary (more difficult), one or two draft the paper, but everybody should check the spreadsheet and the final report.

Two submissions

1. Excel spreadsheet containing your calculations. It should be a live spreadsheet with formulas that I can check, so if your numbers are incorrect, I can see where the problem is.

2. Word document in APA style, with reference list, title page (all the names of the members who worked on the project

The total points of the group project is 150, the spreadsheet and word document each will be worth 75 points

Some Notes:

If there is net positive cash for a month, then you should use that to pay the financing money borrowed.

Eg. if the beginning external financing balance is $200mm, the July has positive cash $90mm, then the $90mm will be the financing repayment

Eg. if the beginning external financing balance is $200mm, the July has positive cash $300mm, then the $200mm will be the financing repayment

You do not have the direct cost for Nov, but that will not affect the cashflow for Nov. since the direct cost is paid one month later.

$50mm is the minimum cash at hand at the end of each month, but you can have more if there more left.