Question
TB Problem Qu. 8-224 Weller Industrial Gas Corporation ... Weller Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's
TB Problem Qu. 8-224 Weller Industrial Gas Corporation ...
Weller Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow:
Sales are budgeted at $390,000 for November, $410,000 for December, and $400,000 for January.
Collections are expected to be 80% in the month of sale and 20% in the month following the sale.
The cost of goods sold is 73% of sales.
The company desires an ending merchandise inventory equal to 80% of the cost of goods sold in the following month.
Payment for merchandise is made in the month following the purchase.
Other monthly expenses to be paid in cash are $20,900.
Monthly depreciation is $20,700.
Ignore taxes.
Balance Sheet
October 31
Assets
Cash
$
21,700
Accounts receivable
82,700
Merchandise inventory
227,760
Property, plant and equipment (net of $593,000 accumulated depreciation)
1,003,000
Total assets
$
1,335,160
Liabilities and Stockholders' Equity
Accounts payable
$
195,700
Common stock
580,000
Retained earnings
559,460
Total liabilities and stockholders' equity
$
1,335,160
Required:
a. Prepare a Schedule of Expected Cash Collections for November and December.
b. Prepare a Merchandise Purchases Budget for November and December.
c. Prepare Cash Budgets for November and December.
d. Prepare Budgeted Income Statements for November and December.
e. Prepare a Budgeted Balance Sheet for the end of December.
can you show step by step on how you get the number, please!
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