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    ParrotBird48516's Avatar
    ParrotBird48516 Posts: 28, Reputation: 1
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    #1

    May 16, 2012, 06:04 PM
    Cash budget accounts to be included
    Please confirm that all of the following accounts are included in a cash budget:

    Cash receipts (sales revenue)
    Accounts payable (purchases)
    Admin expenses (includes depreciation charge)
    Selling expenses
    Credit card charges
    Capital expenditure (shopfront upgrade)
    Tax payments
    Loan - principle
    Loan- interest

    Thanks,

    Parrot
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #2

    May 16, 2012, 11:26 PM
    Quote Originally Posted by ParrotBird48516 View Post
    Please confirm that all of the following accounts are included in a cash budget:

    Cash receipts (sales revenue)
    Accounts payable (purchases)
    Admin expenses (includes depreciation charge)
    Selling expenses
    Credit card charges
    Capital expenditure (shopfront upgrade)
    Tax payments
    Loan - principle
    Loan- interest

    Thanks,

    Parrot
    Only you can decide what is included in accounts payable usually it includes a number of items not just inventory purchases

    Basically you are trying to indentify those items which will have impact on the bank account.

    I'm sure you are aware that depreciation is what is termed a non cash item and a loan would only be included in the month it is received

    As I said before think but don't over think the problem
    ParrotBird48516's Avatar
    ParrotBird48516 Posts: 28, Reputation: 1
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    #3

    May 17, 2012, 06:18 AM
    I seem to make a habit of that I guess! Am just keen to do well and understand the concepts the best I can... but over-thinking does do me in sometimes!

    Thank you for your help as always. I had included depreciation in my calculations which significantly affected the business' cash flow. This will make them much more healthy.

    You have helped save my sanity!

    Sincere appreciation,

    Parrot
    smart_ruby's Avatar
    smart_ruby Posts: 2, Reputation: 2
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    #4

    May 17, 2012, 12:21 PM
    Depreciation is not included in cash budget because it is non-cash item
    ParrotBird48516's Avatar
    ParrotBird48516 Posts: 28, Reputation: 1
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    #5

    May 17, 2012, 12:36 PM
    Thank you smart_ruby... I have now subtracted the depreciation and the company looks much better. Appreciate your help.

    Parrot
    ParrotBird48516's Avatar
    ParrotBird48516 Posts: 28, Reputation: 1
    New Member
     
    #6

    May 17, 2012, 01:35 PM
    Quote Originally Posted by smart_ruby View Post
    Depreciation is not included in cash budget because it is non-cash item
    smart_ruby

    I have now subtracted depreciation from the cash budget and it looks much better.

    However, can you please confirm if this depreciation amount is included in the budgetd income statement? I understand that depreciation expenses are included in the actual income statement and accumulated depreciation is in the balance sheet. We have been provided monthly admin expenses, the values of which are inclusive of depreciation (not specific if expense or accumulated?) - quite a large proportion.

    Does this full value need to go into the budgeted income statement or do I subtract it from the total admin expense and use the adjusted figure?

    Thank you,

    Parrot
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #7

    May 18, 2012, 05:58 AM
    Parrot what is a budget if not a projection of what an income statement will look like at a future date therefore all items that would ordinarily be found in an income statement will be found in a budget

    I have a feeling you are winging it and not reading your text

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