Problem 8-31 Completing a Master Budget [LO8-2, LO8-4, LO8-7, LO8-8, LO8-9, LO8-10] Hillyard Company, an office supplies specialty store, prepares its master budget on a quarterly basis. The following data have been assembled to assist in preparing the master budget for the first quarter: a. As of December 31 (the end of the prior quarter), the company's general ledger showed the following account balances: Cash Accounts receivable Inventory Buildings and equipment (net) Accounts payable Common stock Retained earnings 58,000 214,400 60,450 368,000 $ 90,525 500,000 110,325 700,850 $ 700,850 $ b. Actual sales for December and budgeted sales for the next four months are as follows: December (actual) January February March April $ 268,000 $ 403,000 $ 600,000 $315,000 $ 211,000 Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 28 Required 3 Required 4 Required 5 Complete the Schedule of expected cash collections: Quarter Schedule of Expected Cash Collections January February March Cash sales $ 80,600 Credit sales 214,400 Total collections $ 295,000 Required 1 Required 2A > Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3 Required 4 Required 5 Complete the merchandise purchases budget: March Quarter Merchandise Purchases Budget January February Budgeted cost of goods sold 241,800* $ 360,000 Add desired ending inventory 90,000+ Total needs 331,800 Less beginning inventory 60,450 Required purchases $ 271,350 *$403,000 sales 60% cost ratio = $241,800. +$360,000 - 25% = $90,000 Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3 Required 4 Required 5 Complete the schedule of expected cash disbursements for merchandise purchases. Schedule of Expected Cash Disbursements for Merchandise Purchases January February March Quarter December purchases $ 90,525 January purchases 135,675 135,675 February purchases March purchases Total cash disbursements for purchases Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3 Required 4 Required 5 Complete the cash budget. (Cash deficiency, repayments and interest should be indicated by a minus sign.) Hillyard Company Cash Budget January February $ 58,000 295,000 March Quarter 226,200 128,240 Beginning cash balance Add cash collections Total cash available Less cash disbursements: Inventory purchases Selling and administrative expenses Equipment purchases Cash dividends Total cash disbursements Excess (deficiency) of cash Financing Borrowings Repayments Interest Total financing Ending cash balance 45,000 399,440 Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 2B Required 3 Required 4 Required 5 Prepare an absorption costing income statement for the quarter ending March 31. Hillyard Company Income Statement For the Quarter Ended March 31 Cost of goods sold: Selling and administrative expenses:
