Posted: July 14th, 2016

Prepare a cash budget for May?

The following information for the month of May has been provided for the Hotel Motel Company:

May 1, cash balance………………………………………..$29,500
Cash collections anticipated in May…………………………38,500
Expected May cash expenditures for operating expenses…….14,000
Inventory purchases to be paid in May……………………….27,000
Cash dividends declared in May to be paid in June……………7,500
May depreciation expense………………………………………5,200
Interest income to be received from investments……………….1,750

Production equipment purchase 50% of which will be
paid in May and the balance paid in June……………………..45,000

Required:
Prepare a cash budget for May.