Devry ACCT 504 Week 6 Case Study Latest



Devry ACCT 504 Week 6 Case Study Latest

ACCT 504 Case Study 3

(Learning Objective 5: Construct and use a cash budget) Nathan Farmer, chief financial officer of Wang Appliance Store, is responsible for the company’s budgeting process. Farmer’s staff is preparing the Wang cash budget for 2014. A key input to the budgeting process is last year’s statement of cash flows, which follows (amounts in thousands):

Wang Appliance Store

Statement of Cash Flows


(in thousands)

Cash Flows from Operating Activities

Collections from customers $51,000

Interest Received 500

Purchase of inventory (36,000)

Operating expenses (10,200)

Net cash provided by operating activities 5,300

Cash Flows from Investing Activities

Purchase of equipment (3,500)

Purchase of investments (500)

Sale of investments 1,000

Net cash used for investing activities (3,000)

Cash Flows from Financing Activities

Payment of long term debt (400)

Issuance of Stock 2,000

Payment of cash dividends (500)

Net cash provided by financing activities 1,100


Increase (decrease) in Cash 3,400

Cash, beginning of year 2,900

Cash, end of year6,300


  1. 1.Prepare the Wang cash budget for 2014.Date the budget simply “2014” and denote the beginning and ending cash balances as “beginning” and “ending.” Assume the company expects 2014 to be the same as 2013, but with the following changes:
  2. a.In 2014, the company expects a 20% increase in collections from customers and a 30% increase in purchases of inventory.
  3. b.There will be no sales of investments in 2014.
  4. c.Wang does not plan to issue stock in 2014.
  5. d.Wang plans to end the year with a cash balance of $5,550.

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Devry ACCT 504 Week 6 Case Study Latest

Best Devry ACCT 504 Week 6 Case Study Latest
Devry ACCT 504 Week 6 Case Study Latest


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