Managerial accounting
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as ofJune 30th is shown below: Beech Corporation Balance Sheet June 30 Reset: Cash 5 91,000 Accounts receivable 133,000 Inventory 36.000 Plant and-equipment, net of 213,000 depreo1at1on Total assets m Liabilities and stockholders' Equity Accounts payable 5 74,000 Common stock 328,000 Retained earnings 71,000 Total liabilities and $473,000 stockholders ' equity Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $240,000, $260,000, $250,000, and $270,000, respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 45% in the month of sale and 55% in the month following the sale. All ofthe accounts receivable at June 30 will be collected in July. 3. Each month's ending inventory must equal 15% ofthe cost of next month's sales. The cost of goods sold is 60% of sales. The company pays for 30% of its merchandise purchases in the month ofthe purchase and the remaining 70% in the month following the purchase. All ofthe accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $44,000. Each month $8,000 ofthis total amount is depreciation expense and the remaining $36,000 relates to expenses that are paid in the month they are incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. Requlred: 1. Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30. 2a. Prepare a merchandise purchases budget for July. August. and September. Also compute total merchandise purchases for the quarter ended September 30. 2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter ended September 30. 3. Prepare an income statement for the quarter ended September 30. 4. Prepare a balance sheet as of September 30. Req 1 Req 2A Req 2B Req 3 Req 4 Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30. Schedule of Expected Cash Collections Month July August September Quarter From accounts receivable $ 133,000 $ 133,000 From July sales 0 From August sales 0 From September sales 0 Total cash collections 133,000 $ 0 $ 0 $ 133,000Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. Add: Desired ending merchandise inventory 0 Budgeted cost of goods sold $ 144,000 0 $156,000 0 $ 150,000 0 $450,000 0 Total needs Less: Beginning merchandise inventory 0 Required purchases Req 1 Req 2A Req 2B Req 3 Req 4 Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter ended September 30. Schedule of Cash Disbursements for Purchases July August September Quarter $ 0 From July purchases 0 From August purchases 0 From September purchases 0 Total cash disbursements $ 0 $ 0 0 $ 0
