Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I will give thumbs up Cash Tesla sells portable voltage tester. Tesla's finance manager is required to prepare the master budget and accumulated the information

I will give thumbs up

image text in transcribed

Cash Tesla sells portable voltage tester. Tesla's finance manager is required to prepare the master budget and accumulated the information below for the months of January, February, and March. Balances on January 1 are expected to be as follows: $5,500 Inventories $309,400 Accounts receivable 416,100 Accounts payable 133,055 The budget is to be based on the following assumptions: 1. Each month's sales are billed on the last day of the month. 2. Customers are allowed a 3% discount if their payment is made within 10 days after the billing date. Receivables are booked at gross. 3. The company collects 60% of the billings within the discount period, 25% by the end of the month after the date of sale, and 9% by the end of the second month after the date of sale; 6% prove uncollectible. 4. It pays 54% of all materials purchases and the selling general, and administrative expenses in the month purchased and the remainder in the following month. Each month's units of ending inventory are equal to 130% of the next month's units of sales. 5. The cost of each unit of inventory is $20. 6. Selling, general, and administrative expenses, of which $2.000 is for depreciation, are equal to 15% of the current month's sales. 7. Actual and projected sales are as follows: Month Sales Units November $354,000 11,800 December 363,000 12.100 January 357.000 11,900 February 342.000 11,400 March 360,000 12,000 April 366,000 12,200 Required: A. Calculate the budgeted cash disbursements during the month of February B. Calculate the budgeted cash collections during the month of January. C. Calculate the budgeted number of units of inventory to be purchased during the month of March D. What does this information communicate to the Finance Manager

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

Intermediate Accounting

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield

18th Edition

1119790972, 9781119790976

More Books

Students also viewed these Accounting questions

Question

Explain the concept of employment at will.

Answered: 1 week ago

Question

Discuss compensation for sales representatives.

Answered: 1 week ago

Question

Explain termination of employment.

Answered: 1 week ago