Question
Purchases and Cash Budgets On July 1, MTC Wholesalers had a cash balance of $350,000 and accounts payable of $198,000. Actual sales for May and
Purchases and Cash Budgets On July 1, MTC Wholesalers had a cash balance of $350,000 and accounts payable of $198,000. Actual sales for May and June, and budgeted sales for July, August, September, and October are:
| Month | Actual Sales | Month | Budgeted Sales |
|---|---|---|---|
| May | $300,000 | July | $ 180,000 |
| June | 320,000 | August | 160,000 |
| September | 200,000 | ||
| October | 240,000 |
All sales are on credit with 75 percent collected during the month of sale, 20 percent collected during the next month, and 5 percent collected during the second month following the month of sale. Cost of goods sold averages 70 percent of sales revenue. Ending inventory is one-half of the next month's predicted cost of sales. The other half of the merchandise is acquired during the month of sale. All purchases are paid for in the month after purchase. Operating costs are estimated at $56,000 each month and are paid during the month incurred.
Required Prepare purchases and cash budgets for July, August, and September.
Do not use a negative sign with your answers.
| MTC Wholesalers | ||||
|---|---|---|---|---|
| Purchases Budget | ||||
| For the Months of July, August, and September | ||||
| July | August | September | ||
| Inventory required, current sales | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | |
| Desired ending inventory | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Total inventory needs | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Less beginning inventory | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Purchases | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | |
Do not use a negative sign with your answers.
| MTC Wholesalers | ||||
|---|---|---|---|---|
| Cash Budget | ||||
| For the Months of July, August, and September | ||||
| July | August | September | ||
| Cash balance, beginning | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | |
| Cash receipts | ||||
| Current month's sales | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Previous month's sales | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Sales two months prior | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Total receipts | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Cash available | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Cash disbursements: | ||||
| Purchases | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Operating costs | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Total disbursements | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | Answer 0.00 points out of 1.00 | |
| Cash balance, ending | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | $Answer 0.00 points out of 1.00 | |
***Please show work***
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Auditing That Matters Case Studies
Authors: Norman David Marks
1st Edition
B089J17FFW, 979-8650160410
