Please provide step-by-step answers, showing formulas to support answers so I may compare it with my calculations for the attached questions relative to budgeting and pro forma financial statements. Many thanks!

WK4 Homework 1. Kayak Co. budgeted the following cash receipts (excluding cash receipts from loans received) and cash disbursements (excluding cash disbursements for loan principal and interest payments) for the first three months of next year. Cash Receipts January$ Februar 523,000 401,000 y March 459,000 Cash Disbursements $ 480,000 353,000 527,000 According to a credit agreement with the company's bank, Kayak promises to have a minimum cash balance of $30,000 at each month-end. In return, the bank has agreed that the company can borrow up to $140,000 at an annual interest rate of 12%, paid on the last day of each month. The interest is computed based on the beginning balance of the loan for the month. The company repays principal on the loan with available cash on the last day of each month. The company has a cash balance of $30,000 and a loan balance of $60,000 at January 1. Prepare monthly cash budgets for each of the first three months of next year. (Amounts to be deducted should be indicated by a minus sign.) KAYAK COMPANY Cash Budget For January, February, and March January Beginning cash balance $30,000 Total cash available Preliminary cash balance Ending cash balance Loan balance Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month 2. $60,000 February March Walker Company prepares monthly budgets. The current budget plans for a September ending inventory of 38,000 units. Company policy is to end each month with merchandise inventory equal to a specified percent of budgeted sales for the following month. Budgeted sales and merchandise purchases for the next three months follow. Sales (Units) Purchases (Units) July 170,000 196,000 August 300,000 298,000 September 290,000 270,000 (1) Prepare the merchandise purchases budget for the months of July, August, and September. WALKER COMPANY Merchandise Purchases Budget For July, August, and September July August Budgeted ending inventory units September 38,000 Required units of available inventory Units to be purchased 196,000 298,000 270,000 (2) Compute the ratio of ending inventory to the next month's sales. July August Budgeted ending inventory units Next month's budgeted sales Ratio of inventory to next month's sales (3) How many units are budgeted for sale in October? Units budgeted for sale in October 3. September 38,000 Use the following information to prepare the July cash budget for Acco Co. It should show expected cash receipts and cash disbursements for the month and the cash balance expected on July 31. a. Beginning cash balance on July 1: $70,000. b. Cash receipts from sales: 35% is collected in the month of sale, 50% in the next month, and 15% in the second month after sale (uncollectible accounts are negligible and can be ignored). Sales amounts are: May (actual), $1,870,000; June (actual), $1,420,000; and July (budgeted), $1,580,000. c. Payments on merchandise purchases: 60% in the month of purchase and 40% in the month following purchase. Purchases amounts are: June (actual), $440,000; and July (budgeted), $450,000. d. Budgeted cash disbursements for salaries in July: $190,000. e. Budgeted depreciation expense for July: $10,000. f. Other cash expenses budgeted for July: $260,000. g. Accrued income taxes due in July: $90,000. h. Bank loan interest due in July: $7,500. Calculation of cash receipts from sales ------------------Collected in------------------Total Sales May June July 31 July Accounts Rec. Credit sales from: May $1,870,000 June 1,420,000 July 1,580,000 Totals $4,870,000 Calculation of cash payments for merchandise ------------------Paid in------------------Total June July Purchases Purchases from: June July Totals 3. Continued $440,000 450,000 $890,000 July 31 Accounts Pay. Drop down menu title options for column 1 rows 1 and 2: Accrued taxes Beginning cash balance Cash receipts from sales Interest on bank loan Other expenses Payments for merchandise Repayment of bank loan Salaries ACCO COMPANY Cash Budget For the Month Ended July 31 Total cash available Cash disbursements: Total cash disbursements 4. Following information relates to Acco Co. a. Beginning cash balance on July 1: $35,000. b.Cash receipts from sales: 27% is collected in the month of sale, 50% in the next month, and 23% in the second month after sale (uncollectible accounts are negligible and can be ignored). Sales amounts are: May (actual), $1,204,000; June (actual), $840,000; and July (budgeted), $980,000. c. Payments on merchandise purchases: 54% in the month of purchase and 46% in the month following purchase. Purchases amounts are: June (actual), $301,000; and July (budgeted), $600,000. d.Budgeted cash disbursements for salaries in July: $147,700. e. Budgeted depreciation expense for July: $8,400. f. Other cash expenses budgeted for July: $105,000. g.Accrued income taxes due in July: $80,000 (related to June). h.Bank loan interest paid July 31: $4,620. Additional Information: a. Cost of goods sold is 40% of sales. b.Inventory at the end of June is $56,000 and at the end of July is $264,000. Salaries payable on June 30 are $35,000 and are expected to be $28,000 on July c. 31. d.The equipment account balance is $1,120,000 on July 31. On June 30, the accumulated depreciation on equipment is $196,000. e. The $4,620 cash payment of interest represents the 1% monthly expense on a bank loan of $462,000. f. Income taxes payable on July 31 are $115,248, and the income tax rate applicable to the company is 35%. g.The only other balance sheet accounts are: Common Stock, with a balance of $439,260 on June 30; and Retained Earnings, with a balance of $750,400 on June 30. Prepare a budgeted income statement for the month of July and a budgeted balance sheet for July 31. Calculation of cash receipts from sales ------------------Collected in------------------Total Sales May June July Credit sales from: May $1,204,000 June 840,000 July 980,000 Totals $3,024,000 Calculation of cash payments for merchandise ------------------Paid in------------------- July 31 July 31 Accounts Rec. Total June Purchases July Accounts Pay. Purchases from: June $301,000 July 600,000 Totals $901,000 Drop down menu title options for Budgeted Income Statement & Budgeted Balance Sheet (below) column 1 Accounts payable Accounts receivable Accumulated depreciation Bank loan interest expense Bank loan payable Cash Common stock Cost of goods sold Depreciation expense Equipment Income tax expense Income taxes payable Inventory Other cash expenses Retained earnings Salaries expense Salaries payable Sales Drop down menu title options for Budgeted Income Statement & Budgeted Balance Sheet (below) column 1 Equipment, net Gross profit Income before taxes Net income Net loss Operating expenses Total assets Total current assets Total current liabilities Total liabilities Total Liabilities and Equity Total operating expenses Total Stockholders' equity 4. Continued ACCO COMPANY Budgeted Income Statement For Month Ended July 31 Operating expenses Total operating expenses ACCO COMPANY Budgeted Balance Sheet As of July 31 Assets Liabilities and Equity Liabilities Stockholders' Equity 5. Tempo Company's fixed budget for the first quarter of calendar year 2013 reveals the following. Sales (16,000 units) Cost of goods sold Direct materials Direct labor Production supplies Plant manager salary $ 3,472,000 $ 380,160 696,960 442,720 180,160 1,700,000 1,772,000 Gross profit Selling expenses Sales commissions Packaging Advertising 121,760 253,280 100,000 475,040 Administrative expenses Administrative salaries Depreciationoffice equip. Insurance Office rent 230,160 200,160 170,160 180,160 780,640 Income from operations $ 516,320 Prepare flexible budgets that show variable costs per unit, fixed costs, and three different flexible budgets for sales volumes of 14,000, 16,000, and 18,000 units. (Round cost per unit to 2 decimal places.) Tedco Flexible Budgets Variable Cost & Fixed Cost drop down title menu options: Administrative salaries Advertising Depreciation - office equip. Direct labor Direct materials Insurance Office rent Packaging Plant manager salary Production supplies Sales Sales commissions Tedco Flexible Budgets Variable Cost & Fixed Cost (last two rows) drop down title menu options: Contribution margin Gross profit Income from operations Total fixed costs Total variable costs 5. Continued TEMPO COMPANY Flexible Budgets For Quarter Ended March 31, 2013 Variable costs: Fixed costs: ------Flexible Budget------ ------Flexible Budget at ------ Variable Amount per Unit 14000 units Total Fixed Cost 16000 units 18000 units 6. Solitaire Company's fixed budget performance report for June follows. The $645,000 budgeted expenses include $606,300 variable expenses and $38,700 fixed expenses. Actual expenses include $50,700 fixed expenses. Fixed Budget 8,600 Actual Results 11,000 $ 860,000 645,000 $ 1,100,000 774,000 $ 240,000 F 129,000 U Income from operations $ 215,000 $ $ 111,000 F Sales (in units) Sales (in dollars) Total expenses 326,000 Variances Prepare a flexible budget performance report showing any variances between budgeted and actual results. List fixed and variable expenses separately. (Do not round intermediate calculations.) Drop down menu title options for column 1 Contribution margin Contribution margin Fixed expenses Sales Variable expenses Income from operation Drop down menu title options for column 5 Fav/Unfav Favorable Unfavorable No variance SOLITAIRE COMPANY Flexible Budget Performance Report For Month Ended June 30 Flexible Actual Variances budget results Contribution margin Fav./Unf. 7. Bay City Company's fixed budget performance report for July follows. The $367,000 budgeted expenses include $280,000 variable expenses and $87,000 fixed expenses. Actual expenses include $77,000 fixed expenses. Fixed Budget 5,000 Actual Results 3,900 $ 400,000 367,000 $ 347,100 332,000 $ 52,900 U 35,000 F Income from operations $ 33,000 $ $ 17,900 U Sales (in units) Sales (in dollars) Total expenses 15,100 Variances Prepare a flexible budget performance report that shows any variances between budgeted results and actual results. List fixed and variable expenses separately. (Do not round intermediate calculations.) Drop down menu title options for column 1 Contribution margin Contribution margin Fixed expenses Sales Variable expenses Income from operations Drop down menu title options for column 5 Fav/Unf: Favorable No variance Unfavorable BAY CITY COMPANY Flexible Budget Performance Report For Month Ended July 31 Flexible budget Contribution margin Actual results Variances Fav./Unf