h. Prepare a pro forma income statement for the quarter. i. Prepare a pro forma balance sheet at the end of the quarter. j. Prepare a pro forma statement of cash flows for the quarter. 6 Answer is not complete. Complete this question by entering your answers in the tabs below. Required H Required I Required J Prepare a pro forma income statement for the quarter. $ Sales revenue 1,237,600 0 866.320 0 371,280 169.956 0 201,324 Cost of goods sold Gross margin Selling and administrative expenses Operating income Interest expense Net income 191,968 Required | > Required H Required I Required J :Prepare a pro forma balance sheet at the end of the quarter. (Amounts to be deducted should be indicated by a minus sign FINCH COMPANY Pro Forma Balance Sheet December 31, year 1 Assets Cash Inventory Accounts receivable V Store fixtures Accumulated depreciation Book value of fixtures 0 Total assets $ 0 Liabilities Accounts payable Utilities payable V Sales commissions payable V Line of credit liability Equity Retained earnings V Total liabilities and equity $ 0 Required H Required I Required J Prepare a pro forma statement of cash flows for the quarter. (Amounts to be deducted should be indicated by a minus FINCH COMPANY Pro Forma Statement of Cash Flows For the Quarter Ended December 31, year 1 Cash flows from operating activities Cash payments for selling and administrative expenses V Cash payments for interest expense Cash payments for inventory V Cash receipts from customers V Net cash flows from operating activities $ 0 Cash flows from investing activities Cash payment for store fixtures O Cash flow from financing activities Net inflow from line of credit Net increase in cash Plus: Beginning cash balance Ending cash balance $ 0[The following information applies to the questions displayed below. ] Finch Company is a retail company that specializes in selling outdoor camping equipment. The company is considering opening a new store on October 1, year 1. The company president formed a planning committee to prepare a master budget for the first three months of operation. As budget coordinator, you have been assigned the following tasks. Required 3. October sales are estimated to be $340,000, of which 35 percent will be cash and 65 percent will be credit. The company expects sales to increase at the rate of 20 percent per month. Prepare a sales budget. b. The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month following the sale. Prepare a schedule of cash receipts. c. The cost of goods sold is 70 percent of sales. The company desires to maintain a minimum ending inventory equal to 20 percent of the next month's cost of goods sold. However, ending inventory of December is expected to be $12,500. Assume that all purchases are made on account. Prepare an inventory purchases budget. d. The company pays 60 percent of accounts payable in the month of purchase and the remaining 40 percent in the following month. Prepare a cash payments budget for inventory purchases. e. Budgeted selling and administrative expenses per month follow. Salary expense (fixed) $18,500 Sales commissions 4% of Sales Supplies expense 2% of Sales Utilities (fixed) $ 1 Depreciation on store fixtures (fixed)* $ 4 Rent (fixed) 5 5,300 Miscellaneous (fixed) $ 1 \"The capital expenditures budget indicates that Finch will Spend $133,000 on Octoberl for store fixtures, which are expected to have a $25,000 salvage value and a twoyear (24-month) useful life. Use this information to prepare a selling and administrative expenses budget. f. Utilities and sales commissions are paid the month after they are incurred; all other expenses are paid in the month in which they are incurred. Prepare a cash payments budget for selling and administrative expenses. 9. Finch borrows funds, in increments of $1,000, and repays them on the last day of the month. Repayments may be made in any amount available. The company also pays its vendors on the last day ofthe month. It pays interest of 2 percent per month in cash on the last day of the month. To be prudent, the company desires to maintain a $17,000 cash cushion. Prepare a cash budget. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Required F Required G Finch borrows funds, in increments of $1,000, and repays them on the last day of the month. Repayments may be made in any amount available. The company also pays its vendors on the last day of the month. It pays interest of 2 percent per month in cash on the last day of the month. To be prudent, the company desires to maintain a $17,000 cash cushion. Prepare a cash budget. (Any repayments/shortage which should be indicated with a minus sign.) Section 1: Cash Receipts Beginning cash balance 9 $ 0 o $ (17,980) $ (4,422) Add: Cash receipts 9 119.000 0 363,800 9 436,560 9 Total Cash available 119,000 345,820 432,138 Section 2: Cash Payments Interest expense 9 0 o 4,820 o 4,536 o For inventory purchases 9 177,072 a 296,262 0 290,816 0 For selling and administrative expenses 0 32,300 a 49,160 0 53,512 0 Purchase of store xtures 0 133,000 a 0 o 0 o o o o o o 0 Total budgeted disbursements 342,372 350,242 348,864 Section 3: Financing Activities Surplus (shortage) 0 (223,372) (4,422) 83,274 Borrowing (repayment) 0 205,392 9 0 9 (56,000) 0 Ending cash balance a $ (17,980) $ (4.422) $ 27.274 Show lessA