HELP!!! This is an extra credit question due by May 18th, 11pm (tomorrow!)
The first 3 images are what's given and the rest is what needs to be filled out
One amendment given by the teacher, "Please note, on the second tab, the maximum loan amount should be $100,000 not $40,000"
Given Data Case 08-29 CRAVAT SALES COMPANY $ 10,000 Minimum ending cash balance Selling price 8 Recent and forecast sales (in units): January (actual) February (actual) March (actual) April May 20,000 24,000 28,000 35,000 45,000 60,000 40,000 36,000 32,000 June July August September Desired ending inventories (percentage of next month's sales) Cost of earrings 90% 5 Purchases paid as follows: In month of purchase In following month 50% 50% Collection on sales: Sales collected current month 25 50% Sales collected following month Sales collected 2nd month following 25% Variable monthly expenses: Sales commissions (per tie) 1.00 Variable monthly expenses: Sales commissions (per tie) 1.00 Fixed monthly expenses: $ 22,000 $ 14,000 $1,200 $1,500 $3,000 Wages and salaries Utilities Insurance Depreciation Miscellaneous $ 25,000 $ 12,000 Land purchased in May Dividends declared each quarter Balance sheet at March 31: Assets $14,000 Cash Accounts receivable $48,000 168,000 February sales March sales 216,000 157,500 14,400 172,700 $ 574,600 Inventory (31,500 units) Prepaid insurance Fixed assets, net of depreciation Total assets Liabilities and Stockholders' Equity $85,750 Accounts payable Dividends payable Capital stock Retained earnings Total liabilities and stockholders' equity 12,000 300,000 176,850 $ 574,600 Agreement with Bank: Borrowing increments $1,000 Agreement with Bank Borrowing increments Maximum borrowing amount Interest rate per month Repayment increments Total of interest paid each quarter Required minimum cash balance $ 1,000 $ 40,000 1% $ 1,000 100% $ 10,000 CRAVAT SALES COMPANY Budgets June Quarter April 1a. Sales budget: Budgeted sales in units Selling price per unit 45,000 35,000 60,000 140,000 Total sales Correct Correct! Correct! Correct 1b. Schedule of expected cash collections: February sales March sales April sales May sales June sales Total cash collections 1c. Merchandise purchases budget: Budgeted sales in units Add budgeted ending inventory Total needs Less beginning inventory Required unit purchases Unit cost Required dollar purchases 1d. Budgeted cash disbursements for merchandise purchases: March purchases April purchases May purchases June purchases Total cash payments 2. CRAVAT SALES COMPANY Cash Budget For the Three Months Ending June 30 April June Quarter Cash balance, beginning Add receipts from customers Total cash available Less disbursements: Purchase of inventory Sales commissions Salaries and wages Utilities Miscellaneous Dividends paid Land purchases Total disbursements Excess (deficiency) of receipts over disbursements Financing: Borrowings Repayments Interest Total financing Cash balance, ending 3. CRAVAT SALES COMPANY Budgeted Income Statement For the Three Months Ended June 30 Sales in units Sales Variable expenses: Cost of goods sold Commissions Contribution margin Fixed expenses: Salaries and wages Utilities Insurance expired Depreciation Miscellaneous Net operating income Less interest expense Net income 4. CRAVAT SALES COMPANY Budgeted Balance Sheet June 30 Assets Cash Accounts receivable Inventory Unexpired insurance Fixed assets, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable, purchases Dividends payable Loans payable, bank Capital stock, no par Retained earnings Total liabilities and equity Accounts receivable at June 30: May sales June sales Total Retained eamings at June 30: Balance, March 31 Add net income Total Less dividends declared Balance, June 30
