2 Schedules of Expected Cash Collections and Disbursements Income Statement Balance Sheet LO8 2, LO8 4, LO8 9, LO8 10 Skip to question The following information applies to the questions displayed below Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year The companys balance sheet as of June 30th is shown below Beech Corporation Balance Sheet June 30 Assets Cash $ 85,000 Accounts receivable 141,000 Inventory 83,250 Plant and equipment, net of depreciation 226,000 Total assets $ 535,250 Liabilities and Stockholders Equity Accounts payable $ 87,000 Common stock 350,000 Retained earnings 98,250 Total liabilities and stockholders equity $ 535,250 Exercise 8 12 (Algo) Beechs managers have made the following additional assumptions and estimates Estimated sales for July, August, September, and October will be $370,000, $390,000, $380,000, and $400,000, respectively All sales are on credit and all credit sales are collected Each months credit sales are collected 35 in the month of sale and 65 in the month following the sale All of the accounts receivable at June 30 will be collected in July Each months ending inventory must equal 30 of the cost of next months sales The cost of goods sold is 75 of sales The company pays for 40 of its merchandise purchases in the month of the purchase and the remaining 60 in the month following the purchase All of the accounts payable at June 30 will be paid in July Monthly selling and administrative expenses are always $50,000 Each month $7,000 of this total amount is depreciation expense and the remaining $43,000 relates to expenses that are paid in the month they are incurred The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30 The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30 Required 1 Prepare a schedule of expected cash collections for July, August, and September 2 a Prepare a merchandise purchases budget for July, August, and September Also compute total merchandise purchases for the quarter ended September 30 2 b Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September 3 Prepare an income statement that computes net operating income for the quarter ended September 30 4 Prepare a balance sheet as of September 30 Reg 1 Reg 2A Reg 20 Reg 3 Reg 4 Prepare a schedule of expected cash collections for July, August, and September Schedule of Expected Cash Collections Month July August September Quarter S 0 0 From July sales From August sales From September sales 0 0 Total cash collections $ 0 0 s S 0 Reg 1 Reg 2A Reg 2 Reg 3 Reg 4 Prepare a merchandise purchases budget for July, August, and September Also compute total merchandise purchases for the quarter ended September 30 Merchandise Purchases Budget July August September Quarter Total needs Required purchases Reg 1 Reg 2A Reg 2e Reg 3 Reg 4 Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September Schedule of Cash Disbursements for Purchases July August September Quarter S 0 From July purchases 0 0 From August purchases From September purchases Total cash disbursements 0 $ 0 s 0 s 0 S 0 Reg 1 Reg 2A Reg 2e Reg 3 Reg 4 Prepare an income statement that computes net operating income for the quarter ended September 30 Beech Corporation Income Statement For the Quarter Ended September 30 0 S 0 Reg 1 Reg 2A Reg 2e Reg 3 Reg 4 Prepare a balance sheet as of September 30 Beech Corporation Balance Sheet September 30 Assets s S Total assets Liabilities and Stockholders' Equity Total liabilities and stockholders' equity $ 0

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2. Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-9, LO8-10] Skip to question [The following information applies to the

2. Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-9, LO8-10]

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[The following information applies to the questions displayed below.]

Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The companys balance sheet as of June 30th is shown below:

Assets
Beech Corporation
Balance Sheet
June 30
Cash	$ 85,000
Accounts receivable	141,000
Inventory	83,250
Plant and equipment, net of depreciation	226,000
Total assets	$ 535,250
Liabilities and Stockholders Equity
Accounts payable	$ 87,000
Common stock	350,000
Retained earnings	98,250
Total liabilities and stockholders equity	$ 535,250

Exercise 8-12 (Algo)

Beechs managers have made the following additional assumptions and estimates:

Estimated sales for July, August, September, and October will be $370,000, $390,000, $380,000, and $400,000, respectively.
All sales are on credit and all credit sales are collected. Each months credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July.
Each months ending inventory must equal 30% of the cost of next months sales. The cost of goods sold is 75% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July.
Monthly selling and administrative expenses are always $50,000. Each month $7,000 of this total amount is depreciation expense and the remaining $43,000 relates to expenses that are paid in the month they are incurred.
The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.

Required:

1. Prepare a schedule of expected cash collections for July, August, and September.

2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30.

2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September.

3. Prepare an income statement that computes net operating income for the quarter ended September 30.

4. Prepare a balance sheet as of September 30.

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Reg 1 Reg 2A Reg 20 Reg 3 Reg 4 Prepare a schedule of expected cash collections for July, August, and September. Schedule of Expected Cash Collections Month July August September Quarter S 0 0 From July sales From August sales From September sales 0 0 Total cash collections $ 0 0 s S 0 Reg 1 Reg 2A Reg 2 Reg 3 Reg 4 Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. Merchandise Purchases Budget July August September Quarter Total needs Required purchases Reg 1 Reg 2A Reg 2e Reg 3 Reg 4 Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Schedule of Cash Disbursements for Purchases July August September Quarter S 0 From July purchases 0 0 From August purchases From September purchases Total cash disbursements 0 $ 0 s 0 s 0 S 0 Reg 1 Reg 2A Reg 2e Reg 3 Reg 4 Prepare an income statement that computes net operating income for the quarter ended September 30. Beech Corporation Income Statement For the Quarter Ended September 30 0 S 0 Reg 1 Reg 2A Reg 2e Reg 3 Reg 4 Prepare a balance sheet as of September 30. Beech Corporation Balance Sheet September 30 Assets s S Total assets Liabilities and Stockholders' Equity Total liabilities and stockholders' equity $ 0