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a . Budgeted monthly absorption costing income statements for April - July are: * Includes $ 1 8 , 0 0 0 of depreciation each
a Budgeted monthly absorption costing income statements for AprilJuly are:
Includes $ of depreciation each month.
b Sales are for cash and on account.
c Sales on account are collected over a threemonth period with collected in the month of sale, collected in the first
month following the month of sale, and the remaining collected in the second month following the month of sale. February's
sales totaled $ and March's sales totaled $
d Inventory purchases are paid for within days. Therefore, of a month's inventory purchases are paid for in the month of
purchase. The remaining are paid in the following month. Accounts payable at March for inventory purchases during
March total $
e Each month's ending inventory must equal of the cost of the merchandise to be sold in the following month. The
merchandise inventory at March is $
f Dividends of $ will be declared and paid in April.
g Land costing $ will be purchased for cash in May.
h The cash balance at March is $; the company must maintain a cash balance of at least $ at the end of each
month.
i The company has an agreement with a local bank that allows the company to borrow in increments of $ at the beginning
of each month, up to a total loan balance of $ The interest rate on these loans is per month, and for simplicity we
will assume interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the
end of the quarter.
Required:
Prepare a schedule of expected cash collections for April, May, and June, and for the quarter in total.
Prepare the following for merchandise inventory:
a A merchandise purchases budget for April, May, and June.
b A schedule of expected cash disbursements for merchandise purchases for April, May, and June, and for the quarter in total.
Prepare a cash budget for April, May, and June as well as in total for the quarter. Required
Required A
Required B
Prepare a schedule of expected cash collections for April, May, and June, and for the quarter in total.
tableSchedule of Expected Cash CollectionsApril,May,June,QuarterCash sales,,,,Sales on account:,,,,FebruaryMarchAprilMayJuneTotal cash collections,,,, Required
Required A
Required B
Required
Prepare a cash budget for April, May, and June as well as in total for the quarter.
Note: Cash deficiency, repayments and interest should be indicated by a minus sign.
tableGarden Sales, IncorporatedCash BudgetFor the Quarter Ended June April,May,June,QuarterBeginning cash balanceAdd collections from customersTotal cash availableLess cash disbursements:Purchases for inventorySelling expensesAdministrative expensesLand purchasesDividends paidTotal cash disbursementsExcess deficiency of cash available over disbursementsFinancing:BorrowingsRepaymentInterestTotal financingEnding cash balance,,,, Prepare the following for merchandise inventory, a merchandise purchases budget for April, May, and June.Prepare the following for merchandise inventory, a schedule of expected cash disbursements for merchandise purchases for April, May, and June, and for the quarter in total.
tableSchedule of Expected Cash Disbursements for Merchandise Purchases,April,May,June,QuarterApril purchases,,,,May purchases,,,,June purchases,,,,Total cash disbursements,,,,
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