Cassie Is a Manufacturer of Sketching Pads

question 22

Essay

Cassie is a manufacturer of sketching pads.The following information is available from the company's budgets:
Manufacturing overhead includes depreciation of $12,000 per month.There is no depreciation included in the selling and administrative expenses.All expenses are paid in the month they are incurred.Cash at the beginning of the period was $20,000.The company wants to maintain a minimum cash balance of $20,000.There were no loans outstanding on May 1.The line of credit with the bank allows for borrowings and repayments in $1,000 increments.If the loan is paid off by the end of the quarter,there is no interest.
a.Prepare monthly cash budgets for the 2^nd quarter.
b.What is the amount of cash shown on the balance sheet at the end of the quarter?

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Definitions:

Performance Rating

An evaluation of an employee's or machine's work output against a set standard or within a specific period.

Normal Time

The standard time that a task or operation should take under normal working conditions, used in planning and scheduling.

Standard Time

The amount of time prescribed for the completion of a job or task, based on average speed and efficiency under normal conditions.

Variable Allowance

An allowance or adjustment made for changes in costs or expenses that may vary over time, often used in budgeting and pricing.