5. Cash budget: January February March Quarter Cash balance, beginning $50,000 Add cash collections 297.500 Total cash available 347.500 Less cash disbursements: Purchases of inventory 136,375 Selling and administrative expenses 131,000 Purchases of equipment Cash dividends Total cash disbursements Excess (deficiency) of cash Financing Borrowings Repayments Interest Total Financing Cash Balance, ending 6. Prepare an income statement that contorms to GAAP specifications for the quarter ending March 31. 20%. 7. Prepare a balance sheet as of March 31, 20XX Sweet Company, a specialty chocolate store, prepares a master budget on a quarterly basis. The company has assembled the following data to assist in preparing its master budget for the first quarter, a. As of December 31 (the end of the prior quarter), the company's general ledger showed the following account balances: Debits Credits Cash $ 50.000 Accounts Receivable 162.500 Inventory 58.000 Buildings and Equipment (net) 370.000 Accounts Payable $ 65,000 Capital Stock 412.500 Retained Earnings 163.000 SMOKE 40.500 b. Actual sales for November and December, along with budgeted sales for the next four months, are as follows: November (actual $250.000 December (actual) $300.000 January $300.000 February 5650.000 March $350.000 April 5200.000 Sales are SON for cash sales and so for credit sales Credit sales are collected in the two months following the sale: 90% the month after the sale. Otwo months after the sale. The accounts receivable at December 31 are a result of November and December credit sales d. The company's gross margin is 45 of sales in other words, cost of goods sold is 55 of sales.) e. Monthly salary and wage expenses are budgeted as follows: Salaries and wages, 527,000 per month for the first two months. $20,000 in Marchas Sweet cuts the hours of its salesforce to reflect declining sales Other monthly expenses are as follows advertising $80.000 per month shipping cost is 5% of total monthly sales revenues, and other expenses are of sales revenues. Depreciation, including depreciation on new assets acquired during the water will be 540,000 for the quarter Each month's ending inventory should also of the following month's cost of goods sold h Onehalf of a month's Inventory purchases are paid for in the month of purchase the other half is paid in the following month During January, the company will purchase a new co machine for $2.000 cash. During March other equipment will be purchased for cash at a cost of 579,500 During January, the company will dectare and pay $3.000 in cash dividends The company must maintain a minimum cash balance of $40.000. An open line of credit is available at a local bank for any borrowing that may be needed during the quarter. All borrowing is done at the beginning of a month, and all repayments we made at the end of a month Borrowing and repayments of principal must be in met of 51.000. Interest is paid only at the of payment of bridal. The w terest rate is our interest on whole moet The con does not pay any income 5. Cash budget: January February March Quarter Cash balance, beginning $50,000 Add cash collections 297.500 Total cash available 347.500 Less cash disbursements: Purchases of inventory 136,375 Selling and administrative expenses 131,000 Purchases of equipment Cash dividends Total cash disbursements Excess (deficiency) of cash Financing Borrowings Repayments Interest Total Financing Cash Balance, ending 6. Prepare an income statement that contorms to GAAP specifications for the quarter ending March 31. 20%. 7. Prepare a balance sheet as of March 31, 20XX Sweet Company, a specialty chocolate store, prepares a master budget on a quarterly basis. The company has assembled the following data to assist in preparing its master budget for the first quarter, a. As of December 31 (the end of the prior quarter), the company's general ledger showed the following account balances: Debits Credits Cash $ 50.000 Accounts Receivable 162.500 Inventory 58.000 Buildings and Equipment (net) 370.000 Accounts Payable $ 65,000 Capital Stock 412.500 Retained Earnings 163.000 SMOKE 40.500 b. Actual sales for November and December, along with budgeted sales for the next four months, are as follows: November (actual $250.000 December (actual) $300.000 January $300.000 February 5650.000 March $350.000 April 5200.000 Sales are SON for cash sales and so for credit sales Credit sales are collected in the two months following the sale: 90% the month after the sale. Otwo months after the sale. The accounts receivable at December 31 are a result of November and December credit sales d. The company's gross margin is 45 of sales in other words, cost of goods sold is 55 of sales.) e. Monthly salary and wage expenses are budgeted as follows: Salaries and wages, 527,000 per month for the first two months. $20,000 in Marchas Sweet cuts the hours of its salesforce to reflect declining sales Other monthly expenses are as follows advertising $80.000 per month shipping cost is 5% of total monthly sales revenues, and other expenses are of sales revenues. Depreciation, including depreciation on new assets acquired during the water will be 540,000 for the quarter Each month's ending inventory should also of the following month's cost of goods sold h Onehalf of a month's Inventory purchases are paid for in the month of purchase the other half is paid in the following month During January, the company will purchase a new co machine for $2.000 cash. During March other equipment will be purchased for cash at a cost of 579,500 During January, the company will dectare and pay $3.000 in cash dividends The company must maintain a minimum cash balance of $40.000. An open line of credit is available at a local bank for any borrowing that may be needed during the quarter. All borrowing is done at the beginning of a month, and all repayments we made at the end of a month Borrowing and repayments of principal must be in met of 51.000. Interest is paid only at the of payment of bridal. The w terest rate is our interest on whole moet The con does not pay any income
