Fill in the missing amounts in the above table. Required: EXERCISE 7-12 Schedules of Expected Cash Collections and Disbursements; Income Statement Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of Balance Sheet [LO7-2, L07-4, LO7-9, LO7-10) the calendar year. The company's balance sheet as of June 30th is shown below: TAKE TWO Beech Corporation Balance Sheet June 30 Estimated sales for September = $240,000 Assets +++ Cash Accounts receivable Inventory ... Plant and equipment, net of depreciation Total assets $ 90,000 136,000 62.000 210,000 $498,000 Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 71,100 327,000 99,900 $498,000 Q 331 Master Budgeting Beech's managers have made the following additional assumptions and estimates Estimated sales for July, August, September, and October will be $210,000, $230,000, $220,000, and $240,000. respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July. 3. Each month's ending inventory must equal 30% of the cost of next month's sales. The cost of goods sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $60,000. Each month $5,000 of this total amount is depreciation expense and the remaining $55,000 relates to expenses that are paid in the month they are incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. Required: 1. Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30. 2. a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter 3. Prepare an income statement for the quarter ended September 30. Use the absorption format shown in ended September 30. Schedule 9. 4. Prepare a balance sheet as of September 30. sements: Income Statement; 13 Ampuh have a ASTROL calls werd wa RO Exercise 7.12 Make Note: Omil Part 3 and Part 4 of Exercise 7. 12 1. Schedule of Expected Cash Collections Quarter July Sept. August $136.000 $136.000 from accounts receivable From July sos 73.500 From August Ses Dib From September sales 27.009 355 220,000 5209.500 Total cash collections 2. o. Merchandise Purchases Budget ACCT 230 Darla Kay Karnes - Chapter 7 Homework 2 y Set and sales for a SO wi July August Sept Total Budgeted.cost of goods sold of $126.000 Budgeted cost of goods sold (0) $126.000 Add desiredonding merchandise inventory 41.400 167 400 Total needs Le beginning merchandise inventory 42.000 3105.400 Required purchases 2. b. Schedule of Cosh Disbursements July August Sept. Total $71.TOO From accounts payable 42.160 For July purchases For August purchases For September purchases 5113.260 $117.720 Total cash disbursements Make Note: Omit Part 3 and Part 4
