leucation.com/hm.tpx The board of directors of the Cortez Beach Yacht Club (CBYC) is developing plans to acquire more equipment for lessons and reas and purchase about $52,000 of new equipment each year and wants to begin a fund to purchase a $602,000 piece of property for club expansion The club manager is concerned about the club's capability to purchase equipment and expand its facilities. One club member has agreed to help and help the manager ascertain whether the plans are realistic. Additional Information follows the financial statements CORTEZ BEACH YACHT CLUB Statement of Income (Cash Basis) For the Year Ended October 31 Year 8 $ 730,000 $602,000 470,600 362.000 4,2003 ,200 1.204,800 $967,200 $ Cash revenues Annual membership fees Lesson and class fees Miscellaneous Total cash received Cash costs Manager's salary and benefits Regular employees' wages and benefits Lesson and class employees' wages and benefits Supplies Utilities (heat and light) Mortgage interest Miscellaneous Total cash costs Cash income 74,000 382.000 392,000 32.400 44.400 52.000 $ 74,000 382 000 302.000 31.400 30,400 51.200 3.200 $874200 $ 93.000 4.200 3 981,000 223.800 Additional Information 1. Other financial information as of October 31. year : a. Cash in checking account, $15,000 b. Petty cash, $700. c. Outstanding mortgage balance 5744,000. d. Accounts payable for supplies and utilities unpaid as of October 31. year 9. and due in November, year. 5200 2. The club purchased $52.000 worth of sailing equipment during the current fiscal year (ending October 31 year Cash of 522.000 1. which had not been paid as of October 31, year 9. 3. The club began operations in year 3 in rental quarters. In October, year 5 l purchased its current property and and bulan 51200 562.000 plus 5 percent interest annually on the previously unpaid loan balance each November 1. Starting November 1. vers Membership rose 3 percent during year 9, approximately the same annual rate of increase the c as experienced c ened and 6. Membership fees were increased by 11 percent in year 9. The board has tentative plans to increase them by 7 percent enn and class fees have not been increased for three years. The number of classes and lessons has grown significantly each year, the per i at the same percentage as experienced in year 9 (overy a cany cash, Smortgage upplies accounts posed $52.00 as of og in rental de pre 2. which hadgan operam merest and year 9, acon in year 3.562.000 plus rose 3 per increase been increas embership fees were have not 10 1. Other financial Information as of October 31. year : a. Cash in checking account, $15,000 b. Petty cash, $700. c. Outstanding mortgage balance, $744,000. d. Accounts payable for supplies and utilities unpaid as of October 31, year, and due in November, year 9.5.200 2. The club purchased $52,000 worth of sailing equipment during the current fiscal year (ending October 31, year 9). Cash of $22.000 was paid on delivery with bac o n 1, which had not been paid as of October 31, year 9. 3. The club began operations in year 3 in rental quarters. In October, year 5. It purchased its current property (and and building) for 1.238.000, paying 1244.000 down and agree $62,000 plus 5 percent interest annually on the previously unpaid loan balance each November 1, starting November 1 year 6. 4. Membership rose 3 percent during year 9, approximately the same annual rate of increase the club has experienced since it opened and that is expected to continue in the 5. Membership fees were increased by 11 percent in year 9. The board has tentative plans to increase them by 7 percent in year 10 6. Lesson and class fees have not been increased for three years. The number of classes and lessons has grown significantly each year, the percentage growth experienced in year 9 expected to be repeated in year 10. 7. Miscellaneous revenues are expected to grow in year 10 (over year 9) at the same percentage as experienced in year 9 (over year 8). 8. Lesson and class employees' wages and benefits will increase to $605,650. The wages and benefits of regular employees and the manager will increase 11 percent Equipment depreciation and supplies, utilities, and miscellaneous expenses are expected to increase 16 percent. Required: a. Construct a cash budget for year 10 for Cortez Beach Yacht Club. (Do not round Intermediate calculations.) CORTEZ BEACH YACHT CLUB Budgeted Statement of Income (Cash Basis) For the Year 10 Cash revenue Annual membership fees 804533 Lesson and class fees Miscellaneous Total cash received Cash costs Manager's salary and benefits S 82.140 424020 Regular employees' wages and benefits Lesson and class employee wages and benefits 37 584 Cash costs Manager's salary and benefits Regular employees' wages and benefits Lesson and class employee wages and benefits Supplies $ 82,140 424,020 605,650 37,584 51,504 37,200 Utilities Mortgage interest Miscellaneous 4,872 1.242.970 $ 178,856 Total cash expenses Cash income Additional Cash Flows Cash payments: Mortgage payment Accounts payable balance at 10/31/Year 9 Accounts payable on equipment at 10/31/Year 9 Planned new equipment purchase $ 62,000 5,200 30,000 52.000 Total cash payments Cash inflows from income statement Beginning cash balance Cash available for working capital and to acquire property $ 149,200 178.876 15.700 S 45,376 Book & Resources leucation.com/hm.tpx The board of directors of the Cortez Beach Yacht Club (CBYC) is developing plans to acquire more equipment for lessons and reas and purchase about $52,000 of new equipment each year and wants to begin a fund to purchase a $602,000 piece of property for club expansion The club manager is concerned about the club's capability to purchase equipment and expand its facilities. One club member has agreed to help and help the manager ascertain whether the plans are realistic. Additional Information follows the financial statements CORTEZ BEACH YACHT CLUB Statement of Income (Cash Basis) For the Year Ended October 31 Year 8 $ 730,000 $602,000 470,600 362.000 4,2003 ,200 1.204,800 $967,200 $ Cash revenues Annual membership fees Lesson and class fees Miscellaneous Total cash received Cash costs Manager's salary and benefits Regular employees' wages and benefits Lesson and class employees' wages and benefits Supplies Utilities (heat and light) Mortgage interest Miscellaneous Total cash costs Cash income 74,000 382.000 392,000 32.400 44.400 52.000 $ 74,000 382 000 302.000 31.400 30,400 51.200 3.200 $874200 $ 93.000 4.200 3 981,000 223.800 Additional Information 1. Other financial information as of October 31. year : a. Cash in checking account, $15,000 b. Petty cash, $700. c. Outstanding mortgage balance 5744,000. d. Accounts payable for supplies and utilities unpaid as of October 31. year 9. and due in November, year. 5200 2. The club purchased $52.000 worth of sailing equipment during the current fiscal year (ending October 31 year Cash of 522.000 1. which had not been paid as of October 31, year 9. 3. The club began operations in year 3 in rental quarters. In October, year 5 l purchased its current property and and bulan 51200 562.000 plus 5 percent interest annually on the previously unpaid loan balance each November 1. Starting November 1. vers Membership rose 3 percent during year 9, approximately the same annual rate of increase the c as experienced c ened and 6. Membership fees were increased by 11 percent in year 9. The board has tentative plans to increase them by 7 percent enn and class fees have not been increased for three years. The number of classes and lessons has grown significantly each year, the per i at the same percentage as experienced in year 9 (overy a cany cash, Smortgage upplies accounts posed $52.00 as of og in rental de pre 2. which hadgan operam merest and year 9, acon in year 3.562.000 plus rose 3 per increase been increas embership fees were have not 10 1. Other financial Information as of October 31. year : a. Cash in checking account, $15,000 b. Petty cash, $700. c. Outstanding mortgage balance, $744,000. d. Accounts payable for supplies and utilities unpaid as of October 31, year, and due in November, year 9.5.200 2. The club purchased $52,000 worth of sailing equipment during the current fiscal year (ending October 31, year 9). Cash of $22.000 was paid on delivery with bac o n 1, which had not been paid as of October 31, year 9. 3. The club began operations in year 3 in rental quarters. In October, year 5. It purchased its current property (and and building) for 1.238.000, paying 1244.000 down and agree $62,000 plus 5 percent interest annually on the previously unpaid loan balance each November 1, starting November 1 year 6. 4. Membership rose 3 percent during year 9, approximately the same annual rate of increase the club has experienced since it opened and that is expected to continue in the 5. Membership fees were increased by 11 percent in year 9. The board has tentative plans to increase them by 7 percent in year 10 6. Lesson and class fees have not been increased for three years. The number of classes and lessons has grown significantly each year, the percentage growth experienced in year 9 expected to be repeated in year 10. 7. Miscellaneous revenues are expected to grow in year 10 (over year 9) at the same percentage as experienced in year 9 (over year 8). 8. Lesson and class employees' wages and benefits will increase to $605,650. The wages and benefits of regular employees and the manager will increase 11 percent Equipment depreciation and supplies, utilities, and miscellaneous expenses are expected to increase 16 percent. Required: a. Construct a cash budget for year 10 for Cortez Beach Yacht Club. (Do not round Intermediate calculations.) CORTEZ BEACH YACHT CLUB Budgeted Statement of Income (Cash Basis) For the Year 10 Cash revenue Annual membership fees 804533 Lesson and class fees Miscellaneous Total cash received Cash costs Manager's salary and benefits S 82.140 424020 Regular employees' wages and benefits Lesson and class employee wages and benefits 37 584 Cash costs Manager's salary and benefits Regular employees' wages and benefits Lesson and class employee wages and benefits Supplies $ 82,140 424,020 605,650 37,584 51,504 37,200 Utilities Mortgage interest Miscellaneous 4,872 1.242.970 $ 178,856 Total cash expenses Cash income Additional Cash Flows Cash payments: Mortgage payment Accounts payable balance at 10/31/Year 9 Accounts payable on equipment at 10/31/Year 9 Planned new equipment purchase $ 62,000 5,200 30,000 52.000 Total cash payments Cash inflows from income statement Beginning cash balance Cash available for working capital and to acquire property $ 149,200 178.876 15.700 S 45,376 Book & Resources