Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Mast Corporation seeks your assistance in developing cash and other budget information for May, June and July. At April 30. the company had cash of

image text in transcribed

Mast Corporation seeks your assistance in developing cash and other budget information for May, June and July. At April 30. the company had cash of $10,000, accounts receivable of $889,000, inventories of $136.850, and accounts payable of $32.494. The budget is to be based on the following assumptions. Each month's sales are billed on the last day of the month. . Customers are allowed a 2 percent discount if payment is made within 10 days after the billing date. Receivables are recorded in the accounts at their gross amounts (not net of discounts). The billings are collected as follows: 75 percent within the discount period, 10 percent by the end of the month, and 12 percent by the end of the following month. Three percent is uncollectible. Purchase data are as follows. . Of all purchases of merchandise and selling. general, and administrative expenses. 63 percent is paid in the month purchased and the remainder in the following month. The number of units in each month's ending inventory equals 115 percent of the next month's units of sales. The cost of each unit of inventory is $10. Selling. general, and administrative expenses, of which $4.000 is depreciation, equal 10 percent of the current month's sales. Actual and projected sales follow: March April May June July August Dollars $207,880 151,580 178,5ee 171,eee 210, eee 17,000 Units 13,880 10, 180 11,900 11,400 14,880 14,200 Required: a. Compute the budgeted purchases in dollars for May. b. Compute the budgeted purchases in dollars for June. c. Compute the budgeted cash collections during May. (Do not round Intermediate calculations. Round your final answer to nearest whole dollar.) d. Compute the budgeted cash disbursements during June. (Do not round Intermediate calculations. Round your final answer to nearest whole dollar.) e. Compute the budgeted number of units of inventory to be purchased during July. S 13,685 13.110 S a. Budgeted purchases for May b. Budgeted purchases for June Budgeted cash collections d. Budgeted cash disbursements e. Budgeted number of units

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_2

Step: 3

blur-text-image_3

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

Using QuickBooks Accountant 2018 For Accounting

Authors: Glenn Owen

16th Edition

0357042085, 9780357042083

More Books

Students also viewed these Accounting questions