Continuation of P10-29A: cash budgets}

Refer to P10-29A. Vinning Office Supply's sales are \(70 \%\) cash and \(30 \%\) credit (use the rounded sales on the last line of \(\mathrm{P} 10-29 \mathrm{~A}\) ). Credit sales are collected in the month after sale. Inventory purchases are paid \(50 \%\) in the month of purchase and \(50 \%\) the following month. Salaries and sales commissions are also paid half in the month earned and half the next month. Income tax is paid at the end of the year.

The April 30, 2009, balance sheet showed the following balances:

\section*{Requirements}
1. Prepare schedules of

(a) budgeted cash collections,

(b) budgeted cash payments for purchases, and

(c) budgeted cash payments for operating expenses. Show amounts for each month and totals for May and June. Round your computations to the nearest dollar.
2. Prepare a cash budget similar to Exhibit 10-14. If no financing activity took place, what is the budgeted cash balance on June 30, 2009?

Transcribed Image Text:

Cash... $11,000 Accounts payable......... 7,400 Salary and commissions payable. 2,850