Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hide PLEASE COMPLETE ALL QUESTIONS QUESTION 1 (Approximate completion time: 50 mins) [CLO 4] (Total 35 marks) Cash budgeting provides you with information that

image text in transcribed

Hide PLEASE COMPLETE ALL QUESTIONS QUESTION 1 (Approximate completion time: 50 mins) [CLO 4] (Total 35 marks) Cash budgeting provides you with information that assist in planning the company's future cash needs. As the Cost Accountant of Jamaica Innovation Company Ltd you have been provided with the following information that was extracted from the company's records during 2014. The company's financial year runs from January to December of each year. (1) The following table provides information on budgeted sales for the periods indicated: January February March April May June July 2014 Budgeted sales S 1,700,000 1,450,000 2,000,000 2,500,000 2,250,000 1,500,000 1,850,000 The company's records revealed that the company collects 3/4 of its sales revenue in the month of sale and 1/4 the following month. (2) Operating expenses are budgeted to be $3,000,000 annually. Included in this figure is monthly depreciation of $50,000. (3) At the end of March 2014 the company had a credit balance at the bank amounting to $2,500,000. (4) Taxation for the first quarter of 2014 amounting to $300,000 is to be paid in April 2014, while a final payment of $2,050,000 will be made on lot of land in May 2014. (5) Insurance and miscellaneous expenses amounting to $55,000 and $30,000 respectively are expected to be incurred monthly. These amounts have not been included in the operating expenses budget. (6) In May 2014, the company sold one of its machines to a competitor for $300,000 and an investment amounting to $2,200,00 will be collected in June 2014. (7) Budgeted purchases 2014 January 750.000 February 1.000.000 March 000 00F 1 April 1.250.000 May 850,000 June 900.000 July 800.000 "Page 3 of 9

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Cases An Interactive Learning Approach

Authors: Steven M Glover, Douglas F Prawitt

4th Edition

0132423502, 978-0132423502

More Books

Students also viewed these Accounting questions