Cash budget, Financial Management

Assignment Help:

We need to have done some exploration work on all of the major projects for inclusion in our prospectus, but of our $4m we need at least $1m in the bank to pay for all the listing expenses and to ensure we have a reasonable amount of cash in case anything goes wrong. This means that $3m can be spent on all activities in the lead up to the listing. We therefore need a cash budget to ensure we spend appropriately what we have. 

Revenue

Our only source of revenue will be the interest on the money in the bank, so please make sure this is well invested - and safely. We will, of course, need this included in the budget.

Costs

Maintaining our Perth office, including paying the accounts clerk, costs about $15,000 per month. Directors' fees total $30,000 per year. Directors normally fly business class to and from Mali and Niger so some flights to and from should be included, as should reasonable hotel, vehicle and meal costs while there. We believe that at least 10 visits, each of at least a week, will be needed between all the directors to adequately oversee operations there.

Conditions in Wiluna will be much better, so our geologist will need to visit three times and one other director only once, also for a week each, over the period. Please include a reasonable estimate of these costs in the budget, and let us know which airline we should be using for each of these. These trips will be spaced out evenly over the next 24 months. The remainder of the money will form our exploration budget, which you do not need to divide up by purpose (that is for our geologist to do), but will start to be spent from October onwards. Keep in mind that working in the Sahara might be seasonal, so the costs are likely to be much lower when we cannot work.


Related Discussions:- Cash budget

Explain about money markets by maturity of the securities, Explain about mo...

Explain about money markets by maturity of the securities. On the basis of the maturity of the securities traded, money markets can be introduced here: Money markets are financ

Explain the strategic alliance, Explain the Strategic alliance Two  or ...

Explain the Strategic alliance Two  or  more  organisations  agree  to  work  and  collaborate  informally  together  however remaining  independent  from  one  another. Simila

Types of fixed income securities or bonds, Types of Bonds 1. Secured ...

Types of Bonds 1. Secured Versus Unsecured Bonds 2.  Senior versus Subordinate Bonds 3.  Registered and Unregistered Bo

Explain about the non-convertible debentures, Expalin about the Non-Convert...

Expalin about the Non-Convertible Debentures (NCDs) NCDs are plain debenture securities issued by corporations. They are normally medium term in nature, maturing between 1 to 8

State the concept of overtrading, State the concept of Overtrading Over...

State the concept of Overtrading Overtrading can result in insolvency which means companies have severe cash flow problems. This means that a thriving company, which may look v

Certified public accountant, Certified Public Accountant (CPA) - ACCOUNTANT...

Certified Public Accountant (CPA) - ACCOUNTANT who has satisfied education, experience and examination requirements of her or his jurisdiction essential to be certified as a public

Calculation of variances, a) Distinguish among standard costing and budgeta...

a) Distinguish among standard costing and budgetary control.  (b)"Calculation of variances in standard costing is not an end in itself, but a means  to an end" Brief discussion

Treasury auction process, All treasury securities are issued on the b...

All treasury securities are issued on the basis of auction. The auction process is computerized and hence qualified broker-dealers can access it electronically. T

Evaluate the income statement, 2010 equity balance required: (600-20 - 2...

2010 equity balance required: (600-20 - 25 - 15 - 20)= 520 employees eligible Total expected equivalent value = 520 x 500 options x $1.48 = $384,800 $384,800 x 3/4 years = $28

Operating lease, what is operating lease, its features, advantages, its app...

what is operating lease, its features, advantages, its applicability

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd