Esteem is a retail company that sells specialized gardening products The company is considering opening a new store on October 1, Year1 As budget coordinator, you have been asked to prepare a master budget for the first 3 months of the companys operation You have gathered the following information October sales are estimated to be $ 350000 of which 40 percent will be cash and the remainder will be on credit The company expects all sales to increase at the rate of 20 percent per month for November and December Sales in January Year 2 are expected to be $ 320000 The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month following the sale Prepare a sales budget and a schedule of cash receipts using these facts and your excel template Check your answers here before moving to the next part, by completing the cells requested in the chart below a Sales Budget October November December Total Qtr Cash sales Sales on account Total budgeted sales b Schedule of Cash Receipts October November December Total Qtr Current cash sales Plus collections from A R Total collections The cost of goods sold is 60 percent of sales The company desires to maintain a minimum ending inventory equal to 10 percent of the next months cost of goods sold (Ending inventory for December is based on budgeted January Year2 sales ) Assume that all inventory purchases are made on account (on credit) The company pays 30 percent of accounts payable in the month of purchase and the remaining amount in the following month In excel, prepare an inventory purchases budget and a cash payments budget for inventory purchases Use the check figures below before you continue c Inventory Purchases Budget October November December Total Qtr Budgeted cost of goods sold Plus desired ending inventory Inventory needed Less beginning inventory Required purchases (on account) d Cash payments for inventory October November December Total Qtr Payment of current month's A P Payment for prior month's A P Total budgeted payments

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Esteem is a retail company that sells specialized gardening products. The company is considering opening a new store on October 1, Year1. As budget coordinator,

Esteem is a retail company that sells specialized gardening products. The company is considering opening a new store on October 1, Year1. As budget coordinator, you have been asked to prepare a master budget for the first 3 months of the companys operation. You have gathered the following information:

October sales are estimated to be $350000 of which 40 percent will be cash and the remainder will be on credit. The company expects all sales to increase at the rate of 20 percent per month for November and December. Sales in January Year 2 are expected to be $320000.

The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month following the sale.

Prepare a sales budget and a schedule of cash receipts using these facts and your excel template. Check your answers here before moving to the next part, by completing the cells requested in the chart below.

a. Sales Budget	October	November	December	Total-Qtr
Cash sales
Sales on account
Total budgeted sales

b. Schedule of Cash Receipts	October	November	December	Total-Qtr
Current cash sales
Plus collections from A/R
Total collections

The cost of goods sold is 60 percent of sales. The company desires to maintain a minimum ending inventory equal to 10 percent of the next months cost of goods sold. (Ending inventory for December is based on budgeted January Year2 sales.)

Assume that all inventory purchases are made on account (on credit). The company pays 30 percent of accounts payable in the month of purchase and the remaining amount in the following month.

In excel, prepare an inventory purchases budget and a cash payments budget for inventory purchases. Use the check figures below before you continue.

c. Inventory Purchases Budget	October	November	December	Total-Qtr
Budgeted cost of goods sold
Plus desired ending inventory
Inventory needed
Less beginning inventory
Required purchases (on account)

d. Cash payments for inventory	October	November	December	Total-Qtr
Payment of current month's A/P
Payment for prior month's A/P
Total budgeted payments