Cash Budget | Explained With Full Example | Cost Accounting

Summary

This educational video script offers a comprehensive guide to creating a cash budget, focusing on the importance of estimating cash flows for operational efficiency. It walks through an example of Scene Limited, detailing the process of calculating cash inflows from sales and credit collections, as well as outflows from purchases, expenses, and other payments. The script emphasizes the simplicity of the task and provides a step-by-step approach to ensure a clear understanding of cash budgeting.

Takeaways

• 😀 A cash budget is an estimation of cash flows over a specific period and is crucial for ensuring a business has sufficient funds to operate.
• 💼 It's important to remember that a cash budget only deals with actual cash movements, not accounting profits or debts.
• 📅 Companies create cash budgets for specific time frames, such as months or years, to plan and manage their cash flow effectively.
• 📊 The script provides an example of Scene Limited, illustrating how to prepare a cash budget for the months of April, May, and June.
• 🔢 The opening balance is a starting point for the cash budget and is given for the first month; subsequent months' balances are calculated based on the previous month's closing balance.
• 💹 The cash budget includes both cash sales and credit sales, with specific percentages allocated to immediate cash inflow and future debtor collections.
• 📈 Forecast sales are essential for the cash budget, and the script explains how to calculate cash sales and credit collections based on these forecasts.
• 🗓️ A debtors collection schedule helps in understanding when credit sales will be collected, typically spread over several months post-sale.
• 🛒 Credit purchases are also accounted for in the cash budget, with payments often spread between the month of purchase and the following month.
• 🏢 Other cash inflows, such as rent and salaries, are considered expenses and are subtracted from the total cash available to determine the closing balance.
• 📋 The final step in creating a cash budget is calculating the closing balance, which reflects the business's cash position at the end of the budget period.

Q & A

What is the main purpose of a cash budget?

A cash budget is used to estimate cash flows over a specific period of time, helping companies ensure they have enough funds within the business to operate.

Why is it important to remember that a cash budget deals with actual movement of cash?

It is important because the cash budget only accounts for transactions that involve the actual movement of cash, excluding any non-cash transactions.

What is the first step in preparing a cash budget for Scene Limited?

The first step is to determine the opening balance of cash, which in the case of Scene Limited is given as twenty thousand Rand on the first of each month.

How does Scene Limited's sales forecast for April, May, and June impact the cash budget?

The sales forecast for these months helps determine the expected cash inflows from both cash sales and credit sales that will be collected during these periods.

What percentage of Scene Limited's sales are made in cash, and how does this affect the cash budget?

40% of Scene Limited's sales are made in cash, which directly contributes to the cash inflow for the month of sale in the cash budget.

How is the credit sales collection schedule used in the cash budget?

The credit sales collection schedule is used to determine when the remaining 60% of sales made on credit will be collected, which is spread out over the month of sale and the following two months.

What is the significance of the debtors collection schedule in the cash budget?

The debtors collection schedule helps in estimating the cash inflows from credit sales over the specified period, ensuring accurate cash flow forecasting.

How are other cash incomes incorporated into the cash budget?

Other cash incomes, such as any additional cash inflows from non-operational activities, are included in the cash budget to provide a comprehensive view of the total cash inflow.

Can you explain the process of calculating the cash available and the closing balance in the cash budget?

The cash available is calculated by adding all the cash inflows, including opening balance, cash sales, and collections from credit sales. The closing balance is then found by subtracting all cash outflows, such as purchases, expenses, and other payments, from the cash available.

What is the treatment of credit purchases in the cash budget?

Credit purchases are treated as cash outflows in the cash budget. Typically, 50% of credit purchases are paid in the month of purchase, and the remaining 50% is paid in the following month.

How does the cash budget account for expenses such as rent, salaries, and interest payments?

Expenses like rent, salaries, and interest payments are treated as cash outflows in the cash budget and are deducted from the cash available to find the closing balance.

Outlines

00:00

📊 Introduction to Cash Budgeting

This paragraph introduces the concept of cash budgeting, emphasizing its importance for estimating cash flows over a specific period. It clarifies that cash budgets focus on actual cash movements, excluding non-cash transactions. The purpose of a cash budget for companies is to ensure operational liquidity. The example of Scene Limited is introduced, with sales figures for January, February, and March, and the task of preparing a cash budget for April, May, and June is outlined. The process begins with identifying the opening cash balance and forecasting cash sales based on a percentage of total sales.

05:01

🗓️ Debtor Collection Schedule

The second paragraph delves into the debtor collection schedule, illustrating how to track and account for credit sales that are collected over time. It explains the distribution of credit collections over the months following a sale, with percentages allocated to the month of sale and subsequent months. The example continues with Scene Limited, showing calculations for credit sales collections in April, May, and June, based on previous months' sales. This process is crucial for understanding cash inflows from credit customers.

10:03

🛒 Credit Purchases and Other Expenses

This paragraph discusses credit purchases and their payment schedule, highlighting that 50% of credit purchases are paid in the month of purchase and the remaining 50% in the following month. It also covers additional expenses such as rent, salaries, interest payments, and equipment purchases, all of which are cash outflows. The example provided calculates these expenses for April, May, and June, showing how they affect the cash budget.

15:03

💼 Completing the Cash Budget

The fourth paragraph demonstrates the final steps in completing the cash budget. It shows how to calculate the closing balance for each month by subtracting all cash outflows from the cash available. The process involves totaling cash inflows, including sales and other income, and then accounting for expenses such as credit purchases, rent, salaries, and other payments. The paragraph emphasizes the importance of accuracy in reflecting cash movements within the business.

20:04

🎓 Conclusion and Engagement

In the concluding paragraph, the script summarizes the lesson on cash budgeting, reinforcing the simplicity of the process when focusing on cash flows. It invites viewers to share their learning experiences, ask questions, and engage with the content. The speaker encourages viewers to subscribe to the channel, like the video, and share it, and signs off with a friendly farewell until the next lesson.

Keywords

💡Cash Budget

A cash budget is a detailed plan that estimates a company's cash inflows and outflows over a specific period of time. It is crucial for businesses to ensure they have sufficient funds to operate and to plan for any cash shortages. In the video, the cash budget is the central theme, with the example of Scene Limited's cash flows for April, May, and June being calculated to demonstrate the process.

💡Cash Flows

Cash flows refer to the movement of cash into and out of a business. Positive cash flows occur when cash comes into the business, such as from sales, while negative cash flows occur when cash is spent, such as on expenses or investments. The script emphasizes the importance of estimating cash flows accurately within a cash budget.

💡Opening Balance

The opening balance is the starting amount of cash a company has at the beginning of a budgeting period. It serves as the foundation for the cash budget calculations. In the script, the opening balance for April is given as 20,000 Rand, and subsequent opening balances are calculated based on the closing balances of the previous months.

💡Sales

Sales represent the revenue generated from selling goods or services. In the context of a cash budget, the script distinguishes between cash sales (where payment is received immediately) and credit sales (where payment is received later). The company's forecasted sales for the months of April, May, and June are used to calculate expected cash inflows.

💡Credit Sales

Credit sales are sales made on credit, where the customer is allowed to delay payment for a period. The script explains that a portion of the company's sales are credit sales and that these will be collected over time, impacting the cash budget as they are received.

💡Debtors Collection Schedule

A debtors collection schedule is a plan that outlines when credit sales will be collected. It is used to predict future cash inflows from customers who have purchased on credit. The script provides an example of how to create this schedule, showing the distribution of collections over several months.

💡Credit Purchases

Credit purchases are goods or services bought on credit, where payment is not made immediately. The script explains that these purchases need to be accounted for in the cash budget, as they represent cash outflows that the company will need to pay in the future.

💡Rent

Rent is a fixed expense that a business pays for the use of a property. In the script, rent is mentioned as a consistent monthly expense that must be included in the cash budget, affecting the company's cash outflows.

💡Salaries and Wages

Salaries and wages are the payments made to employees for their work. As a regular expense, they are included in the cash budget as cash outflows, showing the company's financial commitment to its workforce.

💡Interest Payment

An interest payment is the cost of borrowing money, paid periodically to the lender. In the script, an interest payment due in May is highlighted as a specific cash outflow that needs to be accounted for in the cash budget.

💡Equipment Purchase

An equipment purchase is an investment in machinery or tools for the business. The script mentions an equipment purchase made in cash in April, which is a significant cash outflow that affects the company's cash position.

💡Closing Balance

The closing balance is the remaining cash balance at the end of a budgeting period. It is calculated by subtracting all cash outflows from the total cash inflows. In the script, the closing balance for each month is determined and used as the opening balance for the next month, illustrating the cyclical nature of cash flow management.

Highlights

Introduction to the concept of a cash budget, emphasizing its importance for estimating cash flows over a specific period.

Explanation of why companies create cash budgets, to ensure sufficient operational funds.

Description of the process for preparing a cash budget, focusing on the months of April, May, and June.

Clarification on the importance of opening balances in a cash budget and how they relate to the previous month's closing balance.

Detailing the method to calculate cash sales from forecasted sales, highlighting the percentage received in the month of sale.

Introduction to the debtors collection schedule for credit sales, explaining how to track cash inflows from credit customers.

Demonstration of how to create a debtors collection schedule for the months of April, May, and June.

Explanation of how to account for credit purchases and their payment schedule in the cash budget.

Guidance on calculating cash outflows for rent, salaries, wages, and interest payments within the cash budget.

Inclusion of one-time cash outflows such as equipment purchases and trading fines in the cash budget.

Step-by-step instruction on how to total up cash inflows and outflows to find the closing balance for each month.

Emphasis on the simplicity of the cash budget process once the initial setup is understood.

Reinforcement of the focus on cash movements only, distinguishing cash budgets from other financial analyses.

Encouragement for viewers to apply the knowledge gained to create their own cash budgets with confidence.

Invitation for viewers to share their educational level and feedback in the comments section.

Call to action for viewers to like, share, and subscribe to the channel for more informative content.

Transcripts

welcome to contacts in this lesson we're

going to be looking at the cash budget

we're going to go through an example and

I'm confident that after this lesson it

should be able to do a cash budget on

your own why do we do the cash budget or

what is a cash budget this is when we

estimate cash flows over a specific

period of time and it is very important

to remember that we are estimating cash

flows and so we are dealing with actual

movement of cash so if anything that is

not cash will not be dealt with in the

cash budget and it's over a specific

period of time so whenever you ask to do

a cash budget you'll be told for which

months or for which years to do the cash

budget for and why do companies do the

cash budget

well companies do this in order to

ensure that they have enough funds

within the business to operate so when

you do the cash budget you are looking

at what is the cash flows during that

specific period over which you are doing

the cash budget so let's go to the

example in this example we are told that

scene Limited had sales of 100,000 ran

in January 800,000 and in February and

90,000 rain in March and we also given

the other information and at the bottom

here we asked to prepare the cash budget

for scene limited for the months of

April May and June so there we have our

periods we asked to do it for every May

and June and that is the only months we

are going to focus on so how do you do

the cash budget this is the table that

we are going to use we have a table it's

written cash budget we have the details

on the left and we have raw three months

on the right April May and June what is

the first thing that we do want to look

at the cash budget we will have our

opening balance so what is our opening

balance so let's add opening balance day

and let's look down here we are told in

additional information that the company

had a cash balance of twenty thousand

ran on the first of every so we'll put

that under opening balance on April

twenty thousand right now for May and

June we don't have the opening balances

the reason for that is because we have

to complete the cash flows for eppley

and their closing balance for every

rupee the opening balance for me and

likewise the closing balance for me will

be the opening balance for June and that

is why we don't have for May and June so

always remember that you will usually be

given the opening balance for the first

month so let's move on to the next thing

what do we have what we our sales were

told here that feel limited had sales of

hundred thousand ran in January

eighty thousand ran in February and

ninety thousand ran in March so those

are some of the sales and we are told

what they they the forecast sales are

for the months of April May and June

it's very important to always remember

that you're dealing with cash here and

not anything on credit so we have to

deal with the cash movements here so we

look at the details like this forty

percent of the company's sales are in

cash so what is the first thing that

we're going to do we're going to do

sales cash sales right this is the sale

that we will have in April May and June

and will receive the money in that same

month and then we'll also have sales

credit sales where we'll receive the

money in April May and June but you look

at that a bit later on but let's look at

the sketch sales

we're told that 40% of the company's

sales are in cash then we're told the

company's forecasts sales for the coming

months as follows a print hundred ten

thousand one may hundred thousand Rand

and June hundred and twenty thousand

right so we know that forty of forty

percent of that will be paid in the

month of sale so we're going to take

hundred and ten thousand grand for the

month of April times the forty percent

to get the cash sale for that month it

gives us forty four thousand gram so put

that for the four thousand redundant

apron and we'll do the same for me and

June so May they their sales

forecast is a hundred thousand Rand

multiply that by 40 percent and it gives

us 40 thousand Rand so we put that under

me and we do the same for June one

hundred and twenty thousand ten times

forty percent will give us what the cash

sale was forty-eight thousand Rand and

who could

that June now you can see how a simple

exercise this is whenever you're given

the sales forecast or the sales for the

months you have to do the cashback that

for only look in the information and see

how many percent of those we're in cash

and you'll take that and put that under

sales and then cash and then we move on

to the next one remember if 40% was on

cash we know that 60% was on credit now

we ask ourselves the question when will

that be paid whatever would be paid in

the month in question or in the months

at which you are doing the cash budget

April May and June we have to include

that because that will be our cash

inflow so if you can see down here we're

told that the trade debtors or credit

things are collected as follows so now

this is the 60% how is it collected

we're told that 20% during the month of

sales 50% during the first month

following the same 20% during the second

month following the month of sale and

10% during the third month following the

month of sale now I hope you can see

from this that we have to do what is

called the debtors collection schedule

or the credit collections and if you'd

like to check that one out we have a

video specifically for that to help you

understand how to do the credit

collections is a very simple one as well

so if you'd like to check that one out

you can find a link in the description

below or you can click the link on the

top right of the screen right now but

here's the table that we will use to do

that debtors collection schedule for you

to know how easy it is to do that so

I've already drawn the data collection

schedule have already plugged in the

month day just for the sake of time and

you can ask yourself the question why do

I put January February March April May

June when because we might collect some

money from January in April when you

might collect the money from February in

April or May and we'll see that just now

we are told that during a 20% is

collected during the month of sale so if

the sale happened back then in January

20 % was collected and then 50% was

collected during the first month

following the sale so it means that 50%

of January sale was collected in

February and 20% during the second month

following the month of sale it means 20%

of January sale was collected in March

and then 10% during the

so that means that 10% of January Sain

will be collected during the third month

which is every and that's why we have

January here we want everything that

effects April May and June because we

are doing the cash budget based on these

three months so we'll just run through

this if you'd like to see a similar

example like I said you can click on the

link in the description below so for

January how much was the same the sales

for January was hundred thousand Ren and

ten percent would be collected in the

third month following the month of sale

we are not concerned with this three

because twenty percent was collected in

January fifty percent in February twenty

percent in March we only concerned what

what happens in these three months and

we know that ten percent during the

third month following the month of sale

so we're going to take a hundred

thousand gram which is the same for

January and we're not going to multiply

that by ten percent yet because we know

forty percent of it was cash so one the

sixty percent

we just don't read it so we take hundred

thousand rand times the sixty percent we

just on credit time is the 10% we just

collected in the third month following

the month of saying which is every and

gives us an amount of 6000 yen so put

six thousand Rand a and then we do the

same thing for February we are told that

eighty percent is in February that was

the sale in February and we know that 40

percent wasn't was in cash so we know

sixty percent is on credit so one that

sixty percent so we say eighty percent

eighty thousand Rand times sixty percent

time is a twenty percent who just

collected during the second month

following the month of sale so that is

how very same the second month following

the month of sale is April so that 9600

goes to three and then we move on to

much 90,000 ran was the sale in March

and we know forty percent was in cash so

60% was on credit so that's what we want

so 60% of much much sale is on credit

how much of it will be collected in in

April when we are told here that fifty

percent is collected during the first

month following the month of sale so 50

percent of what was on credits from much

sales will be collector in heparin so we

take ninety thousand Rand total sale

times sixty percent that's the total

charge on credit Simon's fifty percent

which is blue sheet

like that in April which is 27,000 run

so between the 7000 ran down day and

then we move on to every now we are in

the month in question that's why we have

April also here so we know that in have

real hundred and ten thousand rain is

forecasted as the sales and we know that

for the person is on cash so we've dealt

with that one already

and then the 50 percent which is on

credit you know that 20 percent of the

tool to collected in April so we have

hundred and ten thousand current sales

times sixty percent the total credit

sales times twenty percent which would

be correct in the month of sale which is

April we get 13,200 so good 13200 so we

are done with April

we have ever done everything that we

needed to do in April now the rest will

do now for May and June so for me with

anything from January collected in May

when we can see twenty percent would be

collection the month of saying that is

January fifty percent well attend the

first month following the month of sale

of February twenty percent during the

second month following the month of sale

there is much and ten percent during the

third month following the month of

saying that's every so we can see that

January's credit sales do not affect me

though or have been all collected by

April so we have nothing day in January

now February you know the ten percent

would be June the third month following

the month of sale and there is February

March April and May so much April and

May

so another 10% of February credit sales

would be collected in May and who do the

exact same thing we did before January

we take February's total sales eighty

thousand run times sixty percent the

total credit sales time is what I'm able

to collected in May which is 10% and get

4800 right so put 4800 ran in February

and then how much of much much credit

sales are collected in me well we know

it's 20% concerts during the second

month following the month of sale so how

much were the sales in March

sales in March were 90,000 grand so we

take 90,000 grand times 60 percent the

total credit sales time is 20 percent

which should be collected in May get

10,000 it

under Glenn I hope it's making sense as

we go along so I'm just gonna speed it

up right now and then how much from

April collected in May when you can see

here has two percent during the first

month following the month of sale so we

take April total sales hundred and ten

thousand ran time sixty percent times

fifty percent will be collected in May

instead of thirty thousand runs so put

thirty three thousand ran and then May's

credit sales how much of it will be

collected in May when it's 20 percent

cause during the month of sale so we

take the total sales from a hundred

thousand run time is sixty percent times

twenty percent able collected in the

month of sale

gives us a total of twelve thousand

right and there we have just completed

me so let's go to June so now we know

that nothing in February collected in

June costly to be all collected by the

month of May so we know that ten percent

would of match his credit failing to

collected in June so we take much sales

total sales 90,000 run time is 60

percent together total credit sales

times ten percent who should be

collected in June at 5400 and then for

April how much of April's credit sales

of collected in June we know that it's

the twenty percent so we take hundred

and ten thousand read total sales for

April times sixty percent times twenty

percent she programs in June we have

thirteen thousand two hundred grand who

put that down and then May's credit

sales how much of it in prorated in June

it's fifty percent so we take one

hundred thousand Rand which is May's

total sales times sixty percent that is

the total credit sales times fifty

percent which a product collected in

June we put that thirty thousand reign

over they how much of June's credit

sales would be collected in June

well we know that it's twenty percent so

we take total sales in June hundred and

twenty thousand run time is sixty

percent which is the total credit sales

time soon the person who she was elected

in the month of sale which is June 14

thousand four hundred so we have just

done June so we are done with the data

collection schedule or the credit

collections for the month of April May

and June now what we have to do is total

them up so we know that these are the

cash inflows from credit sales that will

be collected in the

three months so what we have to do you

have to put it in our cash budget so

we're gonna take our cash our they cash

inflows from data collection schedule

and put it in our cash budget so we're

gonna put sales credit so that we know

that this is from the credit collections

and then we put these totals here

fifty-five thousand eight hundred six

thousand six hundred and sixty thirty

thousands in their month so we'll put

that down and then we move on to the

next one here we are told that the

company anticipate other cash income as

follows so here we go to other cash

income we have for April May and June so

we have to include that in our cash

budget because there is cash moving in

or coming into the business that is a

cash inflow so let's put that down

AdvoCare the description doesn't really

matter via routine have a cash income or

other cash that doesn't matter as long

as you are doing your cash budget

correctly and then you put the three so

put them all day so we are done with

that one and then we are told that the

credit purchases from March amounts to

sixty thousand and so you can see from

here going down these are just purchases

and expenses so what I like to do when

I'm doing the cash budget is to just

have my total income or the total cash

inflow down here so it's easy when I

calculate the final figures even if you

don't do it I don't you'll be penalized

for that so I put cash available and

what that means is that I'm adding up

all the inflows or the cash that we have

received to deal in the month and put in

the total down here so I'll put down the

one for April so I had them up together

it comes to 129 800 now for May and June

I'm not gonna do them as yet because I

don't have the opening balances remember

like I said the opening balance for me

would be found from the closing balance

of April and the closing balance for May

will be found I will be will be the

opening balance for June so we'll wait

until we get the closing balance for

April then be able to get the rest so

now that Jeff we have totaled that up

let's look at the credit purchases we're

told that the credit patches for March

amounted to 60,000 RAM and

focus for the next three months as

follows and we are given the focus

create purchases for April May and June

and what is important is here fifty

percent of credit purchases are paid in

the month of patches and the balance is

paid in the following month so you

paying fifty percent in the month that

you have put in that you have done the

credit purchases and you're paying the

remainder fifty percent in the following

month so that should be easy so let's

draw a table similar to the debtors

collection schedule called the credit

purchases which will make it very simple

so we'll just run through it quickly

now how much of matches credit progestin

per collected in April but we know that

in match fifty percent was collected

while I was paid of the a credit

purchases was paid and then in April

fifty percent would be paid so who take

the credit badges for match g6 2000 ram

we multiply that by 50 percent and we

get thirty thousand run so there is how

much will be collected in April for

March and then in every and how much

alcohol except for for it in April

amateur collector for April for the

month of April when we are told that

fifty percent is collected in the month

of patches and who purchased fifty

thousand ran worth of purchases in April

so we'll collect 50 percent of that in

April so we'll take fifty thousand times

fifty percent would get twenty five

thousand Rand so put down twenty five

thousand Rand we just finished with

April so this one is a simple one

so an in May we know that we have

finished collecting the one from match

cause you collected 50 percent in March

and fifty percent in April and for a

period we've collected fifty percent in

April and they remained a 50 percent

collected in the following month which

is March so what is the amount for April

it's 50,000 run so fifty thousand grams

times fifty percent we get twenty five

thousand Rand and that's how much should

be collected in me and how much of male

speaker will be collected in May we know

that it's fifty percent so we take the

maze maze amount forty thousand Rand you

multiply that by 50 percent it gives us

twenty thousand Rand and you put down

twenty thousand rain and we've just

completed the collections or the

payments for April the credit payment

for April remember always remember these

are credit purchases that we made as a

company so we are paying out so this is

an expense going over

business and then in June while you're

not collecting anything from Matt's

cause if collected it all in April we're

not collecting anything from April

because we've collected all by May and

then how much of May salmon will be

collected in June it's 50% so we'll take

May's amount which is called a thousand

time times 50% and we are paying twenty

thousand wren of May's amount in June so

put twenty thousand REM day and then

June how much of June's amount collected

in June it's 50 percent again

so we'll take forty thousand rent for

June the purchases that we made times

fifty percent and we paid out twenty

thousand times for June and have just

completed the credit purchases that's

how easy this one is so we just toss all

those up so just sort of them up and

then we'll go back to our cache budgets

who put their purchases and then under

purchases who put down the totals that

we have here but remember who putting

them in brackets because it's a cash

outflow it's money that is leaving our

business so put the amounts they in

brackets then we move on the rest should

be very simple we are told that rent

paid amounts to five thousand rent per

month so this is rent for each of the

three months that we are doing the cash

budget for so we'll put the rent and put

five thousand rent for each of the three

months and who put them in brackets

because it's a cash outflow and then

we're told that salaries and wages

amounted to 20,000 rent per month we do

the exact same thing we did for rent so

good salaries and wages and who put

twenty thousand rain in brackets for the

three months then we also told that an

interest payment of five thousand rent

is due in May so this is just

specifically for me so nothing in April

and nothing for June so put interest

expense nothing for April nothing for

June but inmates five thousand ran like

we are told and then we're told

equipment valued at 7,500 remember

purchased in cash in April so they have

put equipment purchases or equipment

patches and it's only in April so put

down seven thousand five hundred around

nothing in May and nothing in June

because we are not told of connecting

with regards to equipment for those two

months and then a trading fine of ten

thousand rayna's payable in June so it's

not in April it's know

may its in June so put trading fine and

we'll put it on by June 10,000 written

in brackets so you can see you put all

our expenses in brackets all the cash

outflows in bracket and then we have

just completed the cash budget because

that is the last one that we have just

done so what you do you put our closing

balance at the bottom so put closing

balance and what we will take since we

have already totaled up the cash

available I'm going to take the cash

available and deduct all of these

expenses or all these cash outflows will

deduct them to get our closing balance

what you could have done as well you

could have totaled up your your your

cash outflows all these ones in brackets

and put it down here well I didn't do it

but you could have done it for the sake

of simplicity but it does not matter as

long as you do your cash budget

correctly and your closing balance is

correct so I just took my cash available

and - all these expenses or cash

outflows and we get the closing balance

of thirty two thousand three hundred

rent now we go to me and put our opening

balance remember like I said I open in

balance for me is the closing balance

for April so good for the two thousand

three hundred and then we and I can now

have our cash available we add them up

together we get the cash available of

150 four thousand nine hundred grand and

now that we have our cash available we

can deduct all our expenses so all our

cash outflows to get our closing balance

for me and seventy nine thousand nine

hundred gram and we take a closing

balance for me and put it as an opening

balance for June so could the seventy

nine thousand nine hundred rende and

then we get our cash available at them

we add up all our cash inflows we get

two hundred and one thousand nine

hundred rent and we deduct all our cash

outflows we get hundred and twenty-six

thousand nine hundred Rand and we have

just completed our cash budget so you

can see how simple doing the cash budget

is always remember cash budget deals

with cash flows only the movement of

cash and we are dealing with these three

months specifically so you're paying

attention to what is happening in this

day months I hope that has helped I hope

it has made sense if you have any

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