Required: Fill in the missing amounts in the above table, EXERCISE 7-12 Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO7-2, L07-4, LO7-9, LO7-10) Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: TAKE "WO Beech Corporation Balance Sheet June 30 0,000 Assets $ 90,000 136,000 62,000 210,000 $498,000 Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 71,100 327,000 99,900 $498,000 hp Master Budgeting Bach's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $210,000, $230,000, $220,000, and $240,000, respectively, 2. All sales are on credit 150 all credit sales are collected. Each month's credit sales are collected 35% 30 the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July. Each month's ending inventory must equal 30% of the cost of next month's sales. The cost of goods sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July 4. Monthly selling and administrative expenses are always $60,000. Each month $5,000 of this total amount is depreciation expense and the remaining $55,000 relates to expenses that are paid in the month they are incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. Decuired: to total 3 Exercise 7-12 Moke Note: Oma Part 3 and Port 4 of Exerche 7 12 1. Schedule of Expected Cash Collections July August Sept. Quarter From accounts receivable 5136.000 From Jy sales 73.500 From August sales From September soles: 355 * 220.000 70 Total cash collections $209.500 5458.000 2. a. Merchandise Purchases Budget AT 10 na m's The are in the month of the habe July August Sept. Total $126.000 Budgeted cost of goods sold 60% of solos $126.000 tuageted cost of goods sold /60%) 41,400 So Add desired ending merchandise inventory 167,400 Total needs 62.000 Les beginning merchandise inventory ME $105.400 Required purchases 2. b. Schedule of Cash Disbursements A Apr July August Sept. Total May $71.100 From accounts payable 42,160 ne: For July purchases Coin For August purchases For September purchases Total cash disbursements $113.260 $117.720 Make Note: Omit Part 3 and Part 4 Problem 21 A
