1 Deacon Company is a merchandising company that is preparing a budget for the second quarter of the calendar year. The following information is available. 10 points eBook DEACON COMPANY Balance Sheet March 31 Assets Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and shareholders' Equity Accounts payable Common shares Retained earnings Total liabilities and shareholders' equity $ 62,000 30,000 43,000 90,000 $225,000 Print References $ 55,000 72,000 98,000 $225,000 Budgeted Income Statements Sales Cost of goods sold Gross margin Selling and administrative expenses Operating income April $ 93,000 55,800 37,200 19,000 $ 19, 200 May $ 118,000 70,800 47,200 16,000 $ 31,200 June $ 120,000 72,000 48,000 11,000 $ 37,000 Budgeting Assumptions: a. Sixty percent of sales are cash sales and 40 percent of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80 percent are collected in the month subsequent to the sale. b. Budgeted sales for July are $134,000. C. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. d. Each month's ending merchandise inventory should equal $13,000 plus 50% of the next month's cost of goods sold. e. Depreciation expense is $1,000 per month. All other selling and administrative expenses are paid in full in the month the expense incurred. bok int Required: 1. Calculate the expected cash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30 balance sheet.) ences Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Calculate the budgeted merchandise purchases for April, May, and June. April May June Quarter Budgeted merchandise purchases 1 b. Budgeted sales for July are $134,000. c. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. d. Each month's ending merchandise inventory should equal $13,000 plus 50% of the next month's cost of goods sold. e. Depreciation expense is $1,000 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred. 10 points eBook Print Required: 1. Calculate the expected cash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30 balance sheet.) References Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Calculate the expected cash disbursements for merchandise purchases for April, May, and June. April May June Quarter Budgeted cash disbursements for merchandise purchases Saved Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare a budgeted balance sheet at June 30. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30 balance sheet.) Deacon Company Balance Sheet + June 30 nces Assets Total assets $ 0 Liabilities and Shareholders' Equity Total liabilities and stockholders' equity $ 0 Prev 1 of 4 Next >