Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Minden company is a wholesale distributor of premium European chocolates. The company's balance sheet as of April 30 is given below Minden Company Balance Sheet

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Minden company is a wholesale distributor of premium European chocolates. The company's balance sheet as of April 30 is given below Minden Company Balance Sheet April 30 Assets Cash Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Note payable Conmon stock Retained earnings Total liabilities and stockholders equity $ 15,100 74,750 51,750 233,000 $ 374,600 $ 74,000 11,500 180,000 109.100 $ 374,600 The company is in the process of preparing a budget for May and has assembled the following data: a Sales are budgeted at $275.000 for May of these sales, $82,500 will be for cash; the remainder will be credit sales. One-half of a month's credit sales are collected in the month the sales are made, and the remainder is collected in the following month. All of the April 30 accounts receivable will be collected in May. b. Purchases of inventory are expected to total $214.000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May c. The May 31 inventory balance is budgeted at $87,000. d Selling and administrative expenses for May are budgeted at $81,300, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $2,750 for the month e The note payable on the Apni 30 balance sheet will be paid during May, with $585 in interest. (All of the interest relates to May) 9. During May, the company will borrow $20.800 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year Req 1 and 2 Req3 Req 4 Req 5 1. Calculate the expected cash collections from customers for May. 2. Calculate the expected cash disbursements for merchandise purchases for May. Total cash collections Total cash disbursements Req3 > 0 Cash Budget For the Month of May Beginning cash balance Add collections from customers Total cash available Less cash disbursements: Purchase of inventory Selling and administrative expenses Purchases of equipment Total cash disbursements Excess of cash available over disbursements Financing: Borrowingnote Repayments-note Interest Total financing Ending cash balance 0 0 0 $ $ 0 Minden Company Budgeted Income Statement For the Month of May 0 0 $ 0 Budgeted Balance Sheet May 31 Assets Total assets $ 0 Liabilities and Stockholders' Equity Total liabilities and stockholders' equity $ 0

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

Managerial Accounting Tools For Business Decision Making

Authors: Weygandt, Kimmel, Kieso

4th Edition

0470478535, 978-0470478530

More Books

Students also viewed these Accounting questions

Question

Define the functions of project planning, scheduling, and control.

Answered: 1 week ago

Question

Cite common obstacles to reaching your goals.

Answered: 1 week ago