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of the company’s sales shows that the company’s total sales are 30%
cash sales and 70% credit sales. Further analysis of credit sales shows
that the company receives 50% of the credit sales one month after the
sale and the remaining 50% in the second month after the sale. This
means the cash collections from sales are 30% in the first month of the
sale, 35% in the second month, and 35% in the third month.
The materials purchased by the company amounts to 50% of the sales
for the month. The company pays for the purchases one month after the
initial purchase. The company likes to maintain a cash balance of $5,000.
The cost of borrowing is 10%. The company plans to pay off the loan
whenever there is a surplus and borrow when there is a deficit.
The attached spreadsheet shows revenues (sales), expenses, capital
expenditures, and other expenses for Precision Machines’ next six
months. Using the information given on the spreadsheet, prepare a cash
budget for January through June and determine the cash surplus, deficit,
and the financing needs of the company.
Note: There are two parts to this learning team assignment; Part 2 will
be completed in Week 5.
Review the Learning Team Assignment due in Week 5.
Create an outline for the essay.
Develop a 700-word annotated bibliography using at least 3 resources.
Format your paper consistent with APA guidelines.
Click the Assignment Files tab to submit your assignment.
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FIN 370 Week 4 Cash Flow AnalysisFrank Smith Plumbing
(calculation and 2 Papers)
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