Company Schedule Of Collections

Sheet1unisyms Companyunisyms Companyschedule Of Collections From Sales

Based on the provided financial data, the task involves preparing a cash budget, analyzing the schedule of collections from sales, and understanding related financial statements for Unisyms Company for the months of March and April. The core objective is to develop a comprehensive understanding of the company's cash inflows and outflows, assess liquidity positions, and analyze the financial health through detailed calculation and interpretation of cash receipts, payments, and balances.

Paper For Above instruction

Introduction

The financial management of a company hinges significantly on precise cash flow planning and management. For Unisyms Company, analyzing the schedule of collections from sales, cash budget for two months, and related financial statements provides vital insights into liquidity, operational efficiency, and strategic decision-making. This paper aims to analyze these components, focusing on given data for March and April, and derive meaningful conclusions about the company's cash position and financial stability.

Schedule of Collections from Sales

The schedule demonstrates how the company collects its revenue from sales, both cash sales and credit sales. In March, the total cash sales amounted to $157,500, which increased to $182,000 in April. Collections from accounts receivable include previous months’ sales collections of $51,000 in March and $58,500 in April, along with collections from current month sales of $234,000 in March and $270,400 in April. The total cash receipts were $442,500 for March and $510,900 for April, indicating effective cash collection strategies and the importance of receivables management in maintaining liquidity.

Cash Budget Analysis

For March, the cash budget shows a beginning cash balance of $45,000, with total cash receipts of $442,500. Estimated cash payments for manufacturing costs ($174,500), selling and administrative expenses ($37,000), and taxes ($40,000) sum up to $251,500, which, combined with other disbursements, totals $461,500. The cash balance at month’s end is projected at $26,000, which exceeds the minimum cash requirement of $20,000, resulting in a surplus of $6,000. This indicates a healthy cash position in March.

In April, the cash inflow increases to $510,900, with total payments decreasing to $382,500, primarily due to strategic management of manufacturing and administrative expenses. The ending cash balance for April is projected at $154,400, well above the minimum requirement, reflecting improved liquidity and cash management efficiency.

Payments for Manufacturing Costs and Selling & Admin Expenses

Manufacturing costs recorded for March were $174,500, with payments of $102,000 for prior month’s costs and $72,500 for current month’s costs. In April, these costs amount to $305,000, with payments split into $217,500 for prior costs and $87,500 for current costs, indicating the company's ongoing investment in production. Selling and administrative expenses for March and April are $37,000 and $37,500 respectively, showing consistent operational costs.

Financial Position and Liquidity Assessment

The initial assets and liabilities, including cash and accounts receivable from March 1 and accounts payable, depict a firm actively managing its credit and operational cycle. The cash flow analysis suggests that Unisyms Company maintains sufficient liquidity to meet its minimum cash requirements, with ample excess cash especially in April, which aids long-term planning and investment decisions.

Conclusion

Overall, the financial analysis demonstrates Unisyms Company's sound cash management practices, substantial cash inflows from collections, and effective handling of manufacturing and operational expenses. The liquidity position most notably improves from March to April, reflecting positive operational leverage and financial stability. Continuous monitoring and strategic planning are essential to sustain this performance and support future growth initiatives.

References

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