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The Best Chocolate Company is a wholesale distributor of premium European chocolates. The company's balance sheet on March 3 1 is as follows: The company
The Best Chocolate Company is a wholesale distributor of premium European chocolates. The company's balance sheet on March
is as follows:
The company is in the process of preparing budget data for April. A number of budget items have already been prepared, as follows:
a Sales are budgeted at $ for April. Of these sales, $ will be for cash; the remainder will be credit sales. Onehalf of a
month's credit sales are collected in the month the sales are made, and the remainder are collected in the following month. All of
the April receivables will be collected in April.
b Purchases of inventory are expected to total $ during April. These purchases will all be on account. of all purchases
are paid for in the month of purchase; the remainder are paid in the following month. All of the March accounts payable to
suppliers will be paid during April.
c The April inventory balance is budgeted at $
d Operating expenses for April are budgeted at $ exclusive of depreciation. These expenses will be paid in cash.
Depreciation is budgeted at $ for the month.
e The note payable on the March balance sheet will be paid during April, with $ in interest. All of the interest relates to April.
f New refrigerating equipment costing $ will be purchased for cash during April.
g During April, the company will borrow $ from its bank by giving a new note payable to the bank for that amount. The new
g During April, the company will borrow $ from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year.
Required:
Prepare a cash budget for April. Any "Repayments" and "Interest" should be indicated by a minus sign.
tableThe Best Chocolate Company,Cash Budget,For the Month Ended April Total cash available,Deduct: Disbursements:,Total cash disbursements,Excess of receipts over disbursements,Financing:Total financing,
Prepare a budgeted income statement for April.
The Best Chocolate Company
Budgeted Income Statement
For the Month Ended April
tableCost of goods sold:,,Goods available for sale,,Cost of goods sold,,
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