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Expert Q&A

Done

haPPY HOLIDAYs orcanization gives vou the following information to develoo the following budgets.

• collections for sales for the quarter 10 points
• Purchases for the quarter (10 points)
• Outlavs on purchases for the quarter (10 points)

eD solisemens or scholasterive snessies

expenses for the quarter 10 points)

Cash budget 125 points)

orestonsicsia or corneracion

FELICES FIESTAS

The FELICES FIESTAS Corporation is dedicated to the retail business and is designing its master

Duaget for the next quarter or operations Trom or to June 20xx. The data collected and necessary to WorK with such a budgel are as tollows:

A. Certain data on the Status of the Situation (Balance Sheet as of March 31. 2UXX:

Effective $20,000 Dr.

Inventory $15.400 Dr.

Buildinos and equioment depreciation neti

$225,000 Dr.

Accounts oavable $23.400 Cr

Long-term debts $90,000 Cr.

common shares-capital $100, 000 or.

Retained earnings $61,000 Cr.

Totals

$324.400

S324 AD

B. Ine expected projected) and actual sales tol several monts a a area

April $55,000

May $68,000

June 95.000

July $73.000

1- Monthly sales are 20% in cash and 80% on credit. The credit sales of the previous month are charco in on in me rollowne mom mars wins what is in receivable at the end of March is 80% of

2- the gross pront margin generated by me como stion in is seles s su%o.

Be me That

25% of the budgeted sales cost for next month

4- 40% of monthiv purchases of merchandise are paid in the month of ourchase and the rest in the month following the purchase

o- The exoected monthly expenses are salaries

$12.000; advertising, $7,000 per month and

represent 9% of sales, commissions represent o Yo

expenses are Dad every month nothing is owed a the end of the month.

6- Cash equipment was purchased: $12.000 Ir

April and $8,000 in May 20xx

/- Management wants to maintain a minimum cash balance at the end of each month of $12.000

o- The company paid dividends $4,000

g- When the company needs money, it can borrov

20.000. The interest rate that the bank charges on