Buckeye Pharmaceutical Company – Inflow & Outflow Calculations, Budget Worksheet

Consider the following cash budgeting example for Buckeye Pharmaceutical Company. After referring to the information provided below, prepare a cash budget for the company for the period July to December 2010. All dollar amounts are in thousands.
1. Gross sales by month
§ May 2010 $ 5,000
§ June 5,000
§ July 10,000
§ August 15,000
§ September 20,000
§ October 10,000
§ November 10,000
§ December 5,000
§ January 2011 10,000
2.  All sales transactions are on credit, with historical data showing that 30% of current revenues are collected in the current month, 50% in the next month and 20% in the second month after sale. Assume that bad debt is negligible.
3. Except for supplies, assume that operating expenses are paid during the month they are incurred. Operating expenses (monthly unless indicated otherwise) for the period are as follows:
§ Wages and salaries: $ 750
§ Insurance: 250
§ Depreciation: 300
§ Other expenses: 3,000
§ Taxes (paid in Sep. and Dec.): 500
§ Payment for capital equipment in Oct.: 1,000
§ Supplies purchases in a month must equal 70% of the projected gross sales for the following month. Supplies are paid for in the month after purchase.
4. The corporation must maintain an ending cash balance of $3,500 each month and meets a cash shortfall through a short-term loan. (Ignore interest for purposes of this example.) For simplicity in this example, assume that excess cash remains as cash (i.e., is not reinvested). Assume that at the beginning of July, the company had a cash balance of $3,500 with no short-term loan outstanding.

Rubrics:
Submission  50%
Inflows calculation 15%
Outflows calculation 15%
Budget – worksheet 20%

Students are often burdened with the task of writing essays. They need to master various academic topics, understand how to integrate facts and arguments, and organize all of this information in a clear and logical way. This is not an easy task for many students. But fear not! We’ve got your back. Here at MoreEssays.com, we offer professional academic help that can take on all these tasks on your behalf. All you need to do is fill out the Order form with your paper’s details, and we will get started on it right away!

Click Here to get this paper done within your deadline