PLEASEE HELPthis is an accounting assignment that I do not understand! Please see attached.

Only a Game Inc. Cash Budgeting This really is great! We've only been producing the \"Sticky Fingers\" for six months, and look at the profits. Sales projections for the future go nowhere but up, up, up! I'm going to take my family on a welldeserved vacation. They've put up with a lot; I haven't been home much at all getting this started. We need some quality time together. All this hectic activity has left me mighty tired, so a break would do me a lot of good right now. T. L. Tina T. Rollt, President and Founder, Only a Game Tina Rollt (her parents got a little carried away with names, giving her many problems when she was in school) founded her company in late 2010. She had worked as a product designer for a well-known toy company, developing new toys and games in keeping with the fashions of the times. Tina thought she'd like to market some of her better ideas herself, and decided to invest her savings in founding a new company. She converted her savings into common stock, and taking the simple approach, she called the company Only a Game. Their first hit toy was a puzzle called \"Sticky Fingers,\" a handheld electronic puzzle requiring both dexterity and thinking skills. Each Sticky Fingers costs the company $14 to produce. In addition to these production costs that vary in direct proportion to volume, the company also incurs $4,000 monthly costs just to be in business, irrespective of the month's volume. Sticky Fingers sells to retailers for $22 each. As of December 31, 2010, Only a Game had been producing Sticky Fingers for three months, using rented facilities. The balance sheet on December 31 looked as follows: Only a Game Company Balance Sheet December 31, 2010 Cash Accounts receivable Inventory Total assets Common Stock Retained earnings Total equities Assets Equities $56,500 27,500 14,000 $98,000 $100,000 -2000 $98,000 Rollt was very pleased to be operating at a profit in such a short time. December sales had been 750 units, up from 500 in November, enough to report a profit for the month and to reduce the deficit accumulated in October and November. Sales were projected to be 1,000 units in January, and Rollt's projections showed sales increases of 500 units per month after that. Thus, by May, monthly sales were expected to be 3,000 units. By September, that figure would be 5,000 units. Rollt was very conscious of the importance of developing good sales channel relationships in order to increase sales, so Sticky Fingers' deliveries were always prompt. This required production to be scheduled 30 days in advance of predicted sales. For example, Only a Game produced 1,000 Sticky Fingers in December in anticipation of January sales, and planned to produce 1,500 in January for February's anticipated demand. The company billed its customers with stated terms of 30 days net, but had not spent a lot of effort in enforcing these credit terms, with the result that customers appeared to actually be taking an additional month to pay. All of the company's costs (production and operating) were paid in cash in the month they were incurred. Tina's projections were accurate. By March, sales had reached 2,000 Sticky Fingers, and 2,500 were produced in March for April sale. Total profit for the first quarter of the year 2011 (the end of March) had reached $24,000. In order to get a respite from what had been a very hectic 6 months getting her business started, Tina decided to take her family on a much-deserved vacation in early April (see above). Tina had hardly been gone for a week when her cell phone rang. It was her bookkeeper, who was in a panic. The company's bank balance was nearly at zero, so materials needed for April production could not be purchased. Unless Tina returned immediately to raise more cash, the entire operation would grind to a halt within a few days. Requirements: Based on the facts given in the case, each amount in the Balance Sheet, including Retained Earnings, is reconciled through December 31. Please take a careful look at the reconciliation template (it is provided for your reference.) in order to understand the cost flow from when the company first began. Please assume that the company's policy is to obtain loans at the same, exact amount as needed when necessary and pay them back whenever the company has positive cash balance. (Interest expense is not to be considered in this case analysis.) 1. Prepare monthly income statements, production budgets (units and amounts), cash budgets, and balance sheets based on sales increases of 500 units per month, 60-day collections, and 30-day advance production for January through November 2011. The template includes a guide for this. Be sure to complete the amounts from Oct and Nov which lead to the December figures provided. If you can figure out how that works it will assist you in understanding the dynamics of what is happening for the entire year. 2. When will the company need to borrow funds? When will they be able to repay the loan? 3. How is it possible for a company that starts with $100,000 in capital and has profitable sales for a period of six months to end up with a zero bank balance? In general terms, explain why they needed money in April? 4. How could this problem have been avoided? After preparing the budgets (Question 1) and reviewing the situation, what would you have suggested that Tina should have done in managing the situation? Prepare a revised version of Question 1 based on your suggestions. The best responses will show two major operating changes. Please present each revised change separately to show the impact to the cash position. Then prepare a combined worksheet to show the impact of these suggestions working together. Your final work product will be an Excel workbook with 4 separate worksheet tabs. Any written responses or comments should be entered into a text box within the excel document. (For Q 2,3 and 4) 1. The worksheet from Question 1. 2. Revised worksheet representing the impact of your first suggestion for operating the company. (modifies worksheet from Q 1) 3. Revised worksheet representing the impact of your second suggestion for operating the company. (Again, modifies worksheet from Q 1) 4. Revised worksheet demonstrating the impact of both suggestions taken together. 5. Points will be deducted if you do not utilize the excel functions when completing the assignment. Unit cost 14 Unit selling 22 Monthly op 4,000 Month Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July August SeptemberOctober November sales in units 500 750 1000 1500 2000 2500 3000 3500 4000 4500 5000 5500 6000 production 500 750 1000 1500 2000 2500 3000 3500 4000 4500 5000 5500 6000 6500 Month Oct. Nov. Dec.* Jan. Feb. Mar. Apr. May June July August SeptemberOctober November Income statements: Sales 11000 16500 22000 33000 44000 55000 66000 77000 88000 99000 110000 121000 132000 Cost of sales 7000 10500 14000 21000 28000 35000 42000 49000 56000 63000 70000 77000 84000 Operating 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 Net operat -4000 0 2000 4000 8000 12000 16000 20000 24000 28000 32000 36000 40000 44000 *Dec. numbers are provided as check figures. 6500 7000 143000 91000 4000 48000 Collections budget: Beginning accounts receivable 11000 16500 22000 33000 44000 55000 66000 77000 88000 99000 110000 121000 132000 less Collect 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 plus Current sales 11000 16500 22000 33000 44000 55000 66000 77000 88000 99000 110000 121000 132000 143000 Ending accounts receivable** 27500 38500 55000 77000 99000 121000 143000 165000 187000 209000 231000 253000 275000 **By definition, beginning balance of account receivable for each month equals ending balance of account receivable for previous month and this holds for any account includin Production budget: Units prod 500 Cash requi 7000 750 10500 1000 14000 1500 21000 2000 28000 2500 35000 3000 42000 3500 49000 4000 56000 4500 63000 5000 70000 5500 77000 6000 84000 6500 91000 Cash budget: Beginning balance Add collections Less production & operating cost Excess (deficit) cash to costs Borrowings Repayments Ending balance 74500 0 18000 56500 0 0 56500 56500 0 25000 31500 0 0 31500 31500 0 32000 -500 0 0 -500 -500 0 39000 -39500 0 0 -39500 -39500 0 46000 -85500 0 0 -85500 -85500 0 53000 -138500 0 0 -138500 -138500 0 60000 -198500 0 0 -198500 -198500 0 67000 -265500 0 0 -265500 -265500 0 74000 -339500 0 0 -339500 -339500 0 81000 -420500 0 0 -420500 -420500 0 88000 -508500 0 0 -508500 -508500 0 95000 -603500 0 0 -603500 Balance she Oct. Nov. Cash Accounts receivable Inventory Total Assets Liabilities (debt) Common stock Retained earnings Total equities Dec. Jan. Feb. Mar. Apr. May June July August SeptemberOctober November 56500 31500 -500 -39500 -85500 -138500 -198500 -265500 -339500 -420500 -508500 -603500 27500 38500 55000 77000 99000 121000 143000 165000 187000 209000 231000 253000 14000 21000 28000 35000 42000 49000 56000 63000 70000 77000 84000 91000 98000 91000 82500 72500 55500 31500 500 -37500 -82500 -134500 -193500 -259500 4000 0 100000 -2000 98000 89000 2000 91000 78500 4000 82500 56500 4000 60500 23500 4000 27500 -20500 4000 -16500 -75500 4000 -71500 -141500 4000 -137500 -218500 4000 -214500 -306500 4000 -302500 -405500 4000 -401500 -515500 4000 -511500 ng cash account