Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

9 Part 1 of 2 0.75 points eBook Print References Required information [The following information applies to the questions displayed below.] Built-Tight is preparing

image text in transcribed

9 Part 1 of 2 0.75 points eBook Print References Required information [The following information applies to the questions displayed below.] Built-Tight is preparing its master budget. Budgeted sales and cash payments follow: Budgeted sales July $ 55,500 August $ 71,500 September $ 56,500 Budgeted cash payments for Direct materials Direct labor Overhead 15,460 3,340 19,500 12,740 2,660 16,100 13,060 2,740 16,500 Sales to customers are 20% cash and 80% on credit. Sales in June were $53,000. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $49,000 in cash and $4,300 in loans payable. A minimum cash balance of $49,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $49,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $49,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,300 per month), and rent ($5,800 per month). 1. Prepare a schedule of cash receipts for the months of July, August, and September. BUILT-TIGHT Schedule of Cash Receipts from Sales July August September $ 55,500 $ 71,500 $ 56,500 Sales Cash receipts from: Cash sales Collections of prior period sales Total cash receipts $ 0 S 0 S 0 2. Prepare a cash budget for the months of July. August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Enter your final answers in whole dollars.) BUILT-TIGHT Cash Budget July August September Beginning cash balance Add: Cash receipts Total cash available Less: Cash payments for Direct labor Direct materials Office salaries Interest on loan Overhead Rent Sales commissions Total cash payments Preliminary cash balance Loan activity Additional loan Repayment of loan to bank Ending cash balance Loan balance - Beginning of month Additional loan (loan repayment) Loan balance-End of month Loan balance July August September 0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Forensic Accounting and Fraud Examination

Authors: Mary Jo Kranacher, Richard Riley, Joseph T. Wells

1st edition

047043774X, 978-0470437742

More Books

Students also viewed these Accounting questions

Question

would you recommend investing in Enbridge inc ? why or why not

Answered: 1 week ago

Question

What is a bivariate scatterplot?

Answered: 1 week ago

Question

What is the use of a bivariate scatterplot?

Answered: 1 week ago