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Based on the information below build a Cash Budget for J & J

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Based on the information below build a Cash Budget for J & J Sports Inc.’s potential expansion. ???Expected revenues for the first two years are as follows.o?ales for the 1st quarter of Year 3 are projected at $650,000.?ear 1 (‘000s) Year 2 (‘000s) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 50.00 90.00 160.00 200.00 280.00 350.00 440.00 550.00???General and administrative expenses (wages, taxes, office etc.) are estimated to be $10,000 in Year 1 – Q1 and 20% of sales thereafter. ???Sales salaries and commissions are estimated to be 8% of sales.???Accounts receivable at the beginning of this expansion are $0. o?ollection period = 30 days ????ccounts payable at the beginning of the expansion are $0. o?he Company quarterly purchases from suppliers = 50% of the next quarter’s forecasted sales.o?uppliers are paid on average in 60 days.???The company expects capital outlays in both Year 1 – Q1 of $40,000 and Year 2- Q1 of $20,000 each. ???The expansion will start with an initial cash loan from the parent company of $100,000. Interest on this loan is $2,500 per quarter. The company will pay back the full $100,000 in the Year 2 – Q4.???Interest on any additional short-term borrowing is expected to be 5% per quarter. ???The Company wishes to maintain a $100,000 minimum balance at all times to best manage its working capital and any unexpected commitments. Question #2 – (10 marks)From above, does the company require any short-term financing??xplain. (50 – 100 words)a.??f so, use the template in Appendix A to build a Short-Term Financing Plan. Question #3 – (20 marks)Based on your analysis in Assignments 1-4 create an Executive Summary for J & J Sports Inc.’s CEO on whether it should move forward with the expansion.?ccountingBusinessManagerial AccountingACCT 5550IRA

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