Required information Schedules of Expected Cash Collections and Disbursements Income Statement Balance Sheet LO8 2, LO8 4, LO8 9, LO8 10 Skip to question The following information applies to the questions displayed below Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year The companys balance sheet as of June 30th is shown below Beech Corporation Balance Sheet June 30 Assets Cash $ 85,000 Accounts receivable 141,000 Inventory 83,250 Plant and equipment, net of depreciation 226,000 Total assets $ 535,250 Liabilities and Stockholders Equity Accounts payable $ 87,000 Common stock 350,000 Retained earnings 98,250 Total liabilities and stockholders equity $ 535,250 Exercise 8 13 (Algo) Beechs managers have made the following additional assumptions and estimates Estimated sales for July, August, September, and October will be $370,000, $390,000, $380,000, and $400,000, respectively All sales are on credit and all credit sales are collected Each months credit sales are collected 45 in the month of sale and 55 in the month following the sale All of the accounts receivable at June 30 will be collected in July Each months ending inventory must equal 20 of the cost of next months sales The cost of goods sold is 75 of sales The company pays for 30 of its merchandise purchases in the month of the purchase and the remaining 70 in the month following the purchase All of the accounts payable at June 30 will be paid in July Monthly selling and administrative expenses are always $50,000 Each month $7,000 of this total amount is depreciation expense and the remaining $43,000 relates to expenses that are paid in the month they are incurred 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 Required 1 Prepare a schedule of expected cash collections for July, August, and September 2 a Prepare a merchandise purchases budget for July, August, and September Also compute total merchandise purchases for the quarter ended September 30 2 b Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September 3 Prepare an income statement for the quarter ended September 30 4 Prepare a balance sheet as of September 30 Garrison 17e Rechecks 2020 11 27

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 11, 2024

Required information Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-9, LO8-10] Skip to question [The following information applies to

Required information

Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-9, LO8-10]

Skip to question

[The following information applies to the questions displayed below.]

Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The companys balance sheet as of June 30th is shown below:

Beech Corporation
Balance Sheet
June 30
Assets
Cash	$	85,000
Accounts receivable		141,000
Inventory		83,250
Plant and equipment, net of depreciation		226,000
Total assets	$	535,250
Liabilities and Stockholders Equity
Accounts payable	$	87,000
Common stock		350,000
Retained earnings		98,250
Total liabilities and stockholders equity	$	535,250

Exercise 8-13 (Algo)

Beechs managers have made the following additional assumptions and estimates:

Estimated sales for July, August, September, and October will be $370,000, $390,000, $380,000, and $400,000, respectively.
All sales are on credit and all credit sales are collected. Each months credit sales are collected 45% in the month of sale and 55% in the month following the sale. All of the accounts receivable at June 30 will be collected in July.
Each months ending inventory must equal 20% of the cost of next months sales. The cost of goods sold is 75% of sales. The company pays for 30% of its merchandise purchases in the month of the purchase and the remaining 70% in the month following the purchase. All of the accounts payable at June 30 will be paid in July.
Monthly selling and administrative expenses are always $50,000. Each month $7,000 of this total amount is depreciation expense and the remaining $43,000 relates to expenses that are paid in the month they are incurred.
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.

Required:

1. Prepare a schedule of expected cash collections for July, August, and September.

2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30.

2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September.

3. Prepare an income statement for the quarter ended September 30.

4. Prepare a balance sheet as of September 30.

Garrison 17e Rechecks 2020-11-27