Question
Techlabs operates a computer training center. The following data relate to the preparation of a master budget for January 2012. At the end of 2011,
Techlabs operates a computer training center. The following data relate to the preparation of a master budget for January 2012.
- At the end of 2011, the company's general ledger indicated the following balances:
Debits Credits
Cash---------------------------$50,000----------------- Accounts Payable-----------$40,000
Accounts Rec.---------------$40,000---------------- Note Payable------------------$60.000
Equipment (net)-------------$120,000-------------- Common Stock---------------$30,000
----------------------------------------------------------------Retained earnings----------$80,000
- Tuition revenue in December 2011 was $80,000, and tuition revenue budgeted for January 2012 is $90,000.
- 50% of tutiton revenue is collected in the month earned and 50% is collected in the subsequent month. The receivable balance at the end of 2012 reflects tuition earned in December 2012.
- Monthly expenses (excluding interest expense) are budgeted as follows: salaries, $40,000; rent, $5,000; depreciation on equipment, $7,000; utilites, $800; other, $2,000.
- Expenses are paid in the month incurred. Purchases of equipment are paid in the month after purchase. The $40,000 payable at the end of 2011 represents money owed for the purchase of computer equipment in December 2011.
- The company intends to purchase $30,000 of computer equipment in January 2012. The anticipated $7,000 per month of depreciation reflects the addition of $1,000 of monthly depreciation related to this purchase.
- The note is at 10% per annum and requires monthly interest payments of $500. The payments are mae on the 20th of each month. The principal must be paid in February of 2013.
- The tax rate is 35%.
Required: Complete the following budget.
Budget Balance Sheet as of January 30,2012
Assets
Cash
Accounts Receivable Equipment (net)
Total Assets
Liabilites
Stockholders' Equity
Common Stock
Retained Earnings
Total Stockholders' Equity
Total Liability and Stockholders' Equity
(I need to know the amounts for each of the above sections)
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