Please help on A and B

Based on the information available to you, complete the Purchases Budget worksheet below: Check figures are:January Budgeted Purchase for Next Month Sales = $99,090; March Inventory Needed to be Available during Current Month $146,730. Dream Ice Cream, Inc. PURCHASES BUDGET PLANNING FOR 2020 2 3 Solution: Budgeted Actual Budgeted Budgeted February March Dec 2019 January $ 76,830 5 Desired Ending Inventory Balance for Current Month 6 Current Month's Cost of Sales 157,800 Inventory Needed to be Available during Current Month B Less: Beginning Inventory of Current Month Budgeted Purchase for Next Month Sales 234,630 102,570 $132,060 1 2 3 4 7 1 2 4 13 Dream Ice Cream, Inc. 14 PLANNING DATA FOR 2020 15 16 $ 254,000 $263,000 17 5,08 ActualNovember 2019 Sales $ 2,893. Actual December 2019 Sales 18 19 Expected 2020 Monthly Sales $ 197,000 20 January 148,000 21 February $ 136,000 22 March $ 167,000 23 April 24 25 All Sales are on Credit Collections of Accounts Receivable 26 27 Month of Service 42.00% Month following Service 28 58.00% 29 60.00 % Cost of Goods Sold as a percentage of selling price. 30 31 32 Planned ending inventory as a percentage of next month's required inventory. 65.00% 33 34 Purchases are are allon credit. $ 132,060 35 Actual Purchases made in December 2019 36 Purchases paid in current month 55.00% 37 Purchases paid in next month 45.00% 38 39 Marketing expenses have a fixed and variable portion: Fixed portion 40 $3,450 41 The fixed portion of the marketing is paid in the current month. Variable portion as a percentage of sales 42 1.10% 43 The variable portion is paid one month after the month incurred. 44 Totalmarketing for month. 45 46 Sales commission as a percent of sales 2.00% 47 Salescommission are paid two months after the month incurred. 48 49 Selling and Administrative expenses have a fixedandvariable portion: 50 $23,100 Fixed portion is paid in the month incurred 51 Variable portion as a percentage of Cost of Goods Sold 1.50% Variable S&Aexpenses are paid one month after the month incurred 52 53 54 Insurance policy: Months of insurance coverage paid for 55 12 56 The policy period is from February 1 to January 31 eachyear The premium to be paid on February 1,2020 is 57 $15,660 58 The premium will e charged to prepaid insurance 59 Insurance premium paid on February 1,2019 $15,000 60 61 $5,320 Depreciation expense per month 62 The annual interest rate on the long term debt is 4.15% Interest is incurred on the principalbalance outstanding each month. 64 65 Interest is paid on a quarterly basis. Interest for December to February will be paid March 1. No principal payments are scheduled to be made on the long-term debt until Septem ber of 2021 66 67 The Company's Board of Directors plansto declare a dividend on February 20. 68 $12,000 69 It will be paid on March 5 70 71 Income Tax rate 21.00% 72 Accrued taxes for the three previous months are paid on the 15th of January,April, July and October. 73 74 75 76 Based on the information available to you, complete the Cash Budget worksheet below 4 5 6 Check figures are: January Cash Receipts $235,280; February Cash Disbursements $142,267; 7 March Ending Cash Balance $413,379. 8 9 Solution: 10 Dream Ice Cream, Inc. PLANNED CASH TRANSACTIONS and CASH BUDGET 11 For the Month Ending, 12 13 14 Jan 31, 2020 Feb 28, 2020 Mar 31, 2020 15 Beginning of Month Cash Balan ce 16 17 CASH IN 18 This Month's Sales 9 Last Month 's Sales 20 Total Cash Receipts for Month 21 2 23 Total Cash Available During Month 24 25 CASH OUT 26 Last Month's Purchases 27 This Month's Purchases 28 Marketing 29 Commissions 30 Selling & Ad ministrative 81 Insurance 32 Interest 83 Income Tax 84 Dividends 35 Total Cash Disbursements for Month 6 87 88 End of Month Cash Balance 39 0 1 12 13 4 15 6 47 Use the information provided on the December 31, 2019 Balance Sheet shown below to help you create the budgeting documents requested. Dream Ice Cream, Inc. BALANCE SHEET December 31, 2019 ASSETS Current Assets $ 303,200 Cash Accounts Receiva ble 152,540 76,830 Inventory Prepaid Insurance 1,250 Total Current Assets 533,820 Property Plant and Equipment Equipment Accumulated Depreciation 319,200 (63,840) 255,360 Total Property Plant and Equipment $ Total Assets 789,180 LIABILITIES AND SHAREHOLDERS EQUITY LIABILITIES Current Liabilities Accounts Payable Purchases 59,427 10,340 Sales Commission Payable Selling and Administrative Payable Interest Payable 2,367 415 Marketing Payable 2,893 15,320 Income Taxes Payable Dividends Payable Total Current Liabilities 90,762 Long Term Debt 120,000 Total Liabilities 210,762 SHAREHOLDERS' EQUITY 104,000 Common Stock Retained Earnings 474,418 Total Shareholders' Equity 578,418 Total Liabilities and Shareholders Equity 789,180 Based on the information available to you, complete the Purchases Budget worksheet below: Check figures are:January Budgeted Purchase for Next Month Sales = $99,090; March Inventory Needed to be Available during Current Month $146,730. Dream Ice Cream, Inc. PURCHASES BUDGET PLANNING FOR 2020 2 3 Solution: Budgeted Actual Budgeted Budgeted February March Dec 2019 January $ 76,830 5 Desired Ending Inventory Balance for Current Month 6 Current Month's Cost of Sales 157,800 Inventory Needed to be Available during Current Month B Less: Beginning Inventory of Current Month Budgeted Purchase for Next Month Sales 234,630 102,570 $132,060 1 2 3 4 7 1 2 4 13 Dream Ice Cream, Inc. 14 PLANNING DATA FOR 2020 15 16 $ 254,000 $263,000 17 5,08 ActualNovember 2019 Sales $ 2,893. Actual December 2019 Sales 18 19 Expected 2020 Monthly Sales $ 197,000 20 January 148,000 21 February $ 136,000 22 March $ 167,000 23 April 24 25 All Sales are on Credit Collections of Accounts Receivable 26 27 Month of Service 42.00% Month following Service 28 58.00% 29 60.00 % Cost of Goods Sold as a percentage of selling price. 30 31 32 Planned ending inventory as a percentage of next month's required inventory. 65.00% 33 34 Purchases are are allon credit. $ 132,060 35 Actual Purchases made in December 2019 36 Purchases paid in current month 55.00% 37 Purchases paid in next month 45.00% 38 39 Marketing expenses have a fixed and variable portion: Fixed portion 40 $3,450 41 The fixed portion of the marketing is paid in the current month. Variable portion as a percentage of sales 42 1.10% 43 The variable portion is paid one month after the month incurred. 44 Totalmarketing for month. 45 46 Sales commission as a percent of sales 2.00% 47 Salescommission are paid two months after the month incurred. 48 49 Selling and Administrative expenses have a fixedandvariable portion: 50 $23,100 Fixed portion is paid in the month incurred 51 Variable portion as a percentage of Cost of Goods Sold 1.50% Variable S&Aexpenses are paid one month after the month incurred 52 53 54 Insurance policy: Months of insurance coverage paid for 55 12 56 The policy period is from February 1 to January 31 eachyear The premium to be paid on February 1,2020 is 57 $15,660 58 The premium will e charged to prepaid insurance 59 Insurance premium paid on February 1,2019 $15,000 60 61 $5,320 Depreciation expense per month 62 The annual interest rate on the long term debt is 4.15% Interest is incurred on the principalbalance outstanding each month. 64 65 Interest is paid on a quarterly basis. Interest for December to February will be paid March 1. No principal payments are scheduled to be made on the long-term debt until Septem ber of 2021 66 67 The Company's Board of Directors plansto declare a dividend on February 20. 68 $12,000 69 It will be paid on March 5 70 71 Income Tax rate 21.00% 72 Accrued taxes for the three previous months are paid on the 15th of January,April, July and October. 73 74 75 76 Based on the information available to you, complete the Cash Budget worksheet below 4 5 6 Check figures are: January Cash Receipts $235,280; February Cash Disbursements $142,267; 7 March Ending Cash Balance $413,379. 8 9 Solution: 10 Dream Ice Cream, Inc. PLANNED CASH TRANSACTIONS and CASH BUDGET 11 For the Month Ending, 12 13 14 Jan 31, 2020 Feb 28, 2020 Mar 31, 2020 15 Beginning of Month Cash Balan ce 16 17 CASH IN 18 This Month's Sales 9 Last Month 's Sales 20 Total Cash Receipts for Month 21 2 23 Total Cash Available During Month 24 25 CASH OUT 26 Last Month's Purchases 27 This Month's Purchases 28 Marketing 29 Commissions 30 Selling & Ad ministrative 81 Insurance 32 Interest 83 Income Tax 84 Dividends 35 Total Cash Disbursements for Month 6 87 88 End of Month Cash Balance 39 0 1 12 13 4 15 6 47 Use the information provided on the December 31, 2019 Balance Sheet shown below to help you create the budgeting documents requested. Dream Ice Cream, Inc. BALANCE SHEET December 31, 2019 ASSETS Current Assets $ 303,200 Cash Accounts Receiva ble 152,540 76,830 Inventory Prepaid Insurance 1,250 Total Current Assets 533,820 Property Plant and Equipment Equipment Accumulated Depreciation 319,200 (63,840) 255,360 Total Property Plant and Equipment $ Total Assets 789,180 LIABILITIES AND SHAREHOLDERS EQUITY LIABILITIES Current Liabilities Accounts Payable Purchases 59,427 10,340 Sales Commission Payable Selling and Administrative Payable Interest Payable 2,367 415 Marketing Payable 2,893 15,320 Income Taxes Payable Dividends Payable Total Current Liabilities 90,762 Long Term Debt 120,000 Total Liabilities 210,762 SHAREHOLDERS' EQUITY 104,000 Common Stock Retained Earnings 474,418 Total Shareholders' Equity 578,418 Total Liabilities and Shareholders Equity 789,180