Assignment 7-3 Week 7 Problems Saved Help Save & Exit Submit Check my work You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company's operations: 25 points a. The cash balance on December 1 is $56,800 b. Actual sales for October and November and expected sales for December are as follows: Cash sales Sales on account S 73,480 87,680 87,280 S 430, 080 554,080 650, 080 Print Sales on account are collected over three-month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible C. Purchases of inventory will total $305,000 for December. Thirty percent of a month's inventory purchases are paid during the month of purchase. The accounts payable remaining from November's inventory purchases total $172,500, all of which will be paid in December d. Selling and administrative expenses are budgeted at $481,000 for December Of this amount, $84,700 is for depreciation. e. A new web server for the Marketing Department costing $110,500 will be purchased for cash during December, and dividends totaling $12,000 will be paid during the month. f. The company maintains a minimum cash balance of $20,000. An open line of credit is available from the company's bank to increase its cash balance as needed Required: 1. Calculate the expected cash collections for December 2. Calculate the expected cash disbursements for merchandise purchases for December 3. Prepare a cash budget for December Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month. Complete this question by entering your answers in the tabs below
Assignment 7-3 Week 7 Problems Saved Help Save &Exit Submit Check my work Required: 1. Calculate the expected cash collections for December 2. Calculate the expected cash disbursements for merchandise purchases for December 3. Prepare a cash budget for December, Indicate in the financing section any borrowing that Will be needed during the month. Assume that any interest will not be paid until the following month. 25 points Complete this question by entering your answers in the tabs below Book Print Req 1 and 2 Req 3 1. Calculate the expected cash collections for December 2. Calculate the expected cash disbursements for merchandise purchases for December Total cash colections Total cash disbursements Req 3 > Prey 1or2Next Assignment 7-3 Week 7 Problems Saved Help Save & Exit Submit Check my work Req 1 and 2 Req 3 Prepare a cash budget for December. Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month. 25 points hton Cash Budget For the Month of December Beginning cash balance Add collections from customers Total cash available Less cash disbursements Print Payments to suppliers for inventory Seling and administraive expenses New web server Dividends paid Total cash disbursements Excess (deficiency) of cash available over disbursements Financing Borrowing Interest Total tinancing Ending cash balance Req 1 and 2 Prey1 of 2 Next>
