Pur Centers, Inc., operates three fully equipped fitness centers, as well as a medical center that specializes in preventive medicine. The data that follow pertain to the corporation’s first quarter.
Cash receipts:
Memberships: December, 870; January, 880; February, 910; March, 1,030 Membership dues: $100 per month, payable on the 10th of the month (80 percent collected on time; 20 percent collected one month late)
Medical examinations: January, $35,610; February, $41,840; March, $45,610
Special aerobics classes: January, $4,020; February, $5,130; March, $7,130
High-protein food sales: January, $4,890; February, $5,130; March, $6,280
Cash payments:
Salaries and wages:
Corporate officers: 2 at $18,000 per month
Physicians: 2 at $7,000 per month
Nurses: 3 at $2,900 per month
Clerical staff: 2 at $1,500 per month
Aerobics instructors: 3 at $1,100 per month
Clinic staff: 6 at $1,700 per month
Maintenance staff: 3 at $900 per month
Health-food servers: 3 at $750 per month
Purchases:
Muscle-toning machines: January, $14,400; February, $13,800 (no purchases in March)
Pool supplies: $520 per month
Health food: January, $3,290; February, $3,460; March, $3,720
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Medical supplies: January, $10,400; February, $11,250; March, $12,640
Medical uniforms and disposable garments: January, $7,410; February, $3,900; March, $3,450
Medical equipment: January, $11,200; February, $3,400; March $5,900
Advertising: January, $2,250; February, $1,190; March, $2,450
Utilities expense: January, $5,450; February, $5,890; March, $6,090
Insurance:
Fire: January, $3,470
Liability: March, $3,980
Property taxes: $3,760 due in January
Federal income taxes: Last year’s taxes of $21,000 due in March
Miscellaneous: January, $2,625; February, $2,800; March, $1,150
Pur Centers’ controller anticipates that the beginning cash balance on January 1 will be $14,000.
Required Prepare a cash budget for Pur Centers for the first quarter of the year. Use January, February, March, and Quarter as the column headings.
SOLUTION Pur Centers, Inc.
Cash Budget
For the Quarter Ended March 31
January January January February February February March Quarter Quarter Quarter Cash receipts: Cash receipts: Cash receipts: Membership dues* Membership dues* $ $ 87,800 $ $ $ 90,400 $ $ 100,600 $ $ $ 278,800 Medical examinations Medical examinations 35,610 41,840 45,610 123,060 Aerobics classes Aerobics classes 4,020 5,130 7,130 16,280 High-protein food sales High-protein food sales 4,890 5,130 6,280 16,300 Total cash receipts Total cash receipts $ $ 132,320 $ $ $ 142,500 $ $ 159,620 $ $ $ 434,440 Cash payments: Cash payments: Cash payments: Salaries and wages: Salaries and wages: Corporate officers $ $ 36,000 $ $ $ 36,000 $ $ 36,000 $ $ $ 108,000 Physicians 14,000 14,000 14,000 42,000 Nurses 8,700 8,700 8,700 26,100 Clerical staff 3,000 3,000 3,000 9,000 Aerobics instructors 3,300 3,300 3,300 9,900 Clinic staff 10,200 10,200 10,200 30,600 Maintenance staff 2,700 2,700 2,700 8,100 Health-food servers 2,250 2,250 2,250 6,750 Purchases: Purchases: Muscle-toning machines 14,400 13,800 — 28,200 Pool supplies 520 520 520 1,560 Health food 3,290 3,460 3,720 10,470 Medical supplies 10,400 11,250 12,640 34,290 Medical clothing 7,410 3,900 3,450 14,760 Medical equipment 11,200 3,400 5,900 20,500 Advertising Advertising 2,250 1,190 2,450 5,890 Utilities expense Utilities expense 5,450 5,890 6,090 17,430 Insurance: Insurance: Fire 3,470 — — — 3,470 Liability — — — — 3,980 3,980 Property taxes Property taxes 3,760 — — — 3,760 Federal income taxes Federal income taxes — — — — 21,000 21,000 Miscellaneous Miscellaneous 2,625 2,800 1,150 6,575 Total cash payments Total cash payments $ $ 144,925 $ $ $ 126,360 $ $ 141,050 $ $ $ 412,335 Cash increase (decrease) Cash increase (decrease) Cash increase (decrease) $ $ (12,605) (12,605) $ $ $ 16,140 $ $ 18,570 $ $ $ 22,105 Beginning cash balance Beginning cash balance Beginning cash balance 14,000 1,395 17,535 14,000 Ending cash balance Ending cash balance Ending cash balance $ $ 1,395 $ $ $ 17,535 $ $ 36,105 $ $ $ 36,105
Calculations:
Membership Dues Membership Dues Membership Dues Membership Dues Membership Dues January January January February February February March March March Quarter Quarter Dec. ( 870 × $100 ) 20% $17,400 $17,400 $ $ 17,400 Jan. ( 880 × $100 ) 80% 70,400 70,400 20% $17,600 $17,600 88,000 Feb. ( 910 × $100 ) 80% 72,800 72,800 20% $ $ 18,200 91,000 Mar. ( 1,030 × $100 ) 80% 82,400 82,400 Total membership dues Total membership dues Total membership dues Total membership dues Total membership dues Total membership dues $87,800 $87,800 $90,400 $90,400 $ $ 100,600 $ $ 278,800