The following data relate to the operations of Shillow Company, wholesale distributor of consumer goods Accounts receivable laire and coulent, net Accounts payaele 22,425 15e.ee 14,975 Retained earnings $ a. The gross margin is 25% of sales D. Actual and budgeted sales data Merch (actual) $ 93,000 $44,000 Soles are 60% for cash and 40% on crean Cred sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales d Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold. e. One hat of a month's inventory purchases is pard for in the month of purchase the other hair is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory 1 Monthly expenses are as follows commissions. 12 of sales, rent $2.000 per month other expenses (excluding depreciation 69 of sales. Assume that these expenses are paid monthly Depreciation is $927 per month includes depreciation on new assets) 9 Equipment costing $1200 wir be purchased for cash in April Management would like to maintain a minimum cash balance of at least $4,000 at the end of each month. The company has an agreement with a local bank that allows the company to borrow in increments of $1.000 at the beginning of each month up to a total loan balance of $20.000. The interest rate on these loans is 1 per month and for simplicity we will assume that interest is not compounded the company would, as far as t able, repay the loan plus accumulated interest at the end of the quarter Required: Using the preceding data 1 Complete the schedule of expected cash collections 2. Complete the merchandise purchases budget and the schedule of expected cash asbursements for merchandise purchases 3. Complete the cash budget Prepare an absorption costing income statement for the quarter ended June 30 Prepare o balance sheet as of June 30, The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: Cash Accounts receivable Inventory Building and equipment, net Accounts payable Common stock Retained earnings 7,200 $ 18,809 $ 37,800 $ 123,600 $ 22,425 $ 150,000 $ 14,975 a. The gross margin is 25% of sales. b. Actual and budgeted sales data: March (actual) April $ 47,000 $ 63,000 $ 68,000 $ 93,000 $ 44,000 June July c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. Type here to search d. Each month's ending Inventory should equal 80% of the following month's budgeted cost of goods sold. e. One-half of a month's inventory purchases is paid for in the month of purchase, the other half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory. f. Monthly expenses are as follows: commissions, 12% of sales, rent, $2,000 per month other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly. Depreciation is $927 per month (includes depreciation on new assets) g. Equipment costing $1,200 will be purchased for cash in April h. Management would like to maintain a minimum cash balance of at least $4,000 at the end of each month. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $20,000. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter. Required: Using the preceding data: 1. Complete the schedule of expected cash collections 2. Complete the merchandise purchases budget and the schedule of expected cash disbursements for merchandise purchases. 3. Complete the cash budget. 4. Prepare an absorption costing income statement for the quarter ended June 30 5. Prepare a balance sheet as of June 30. Type here to search The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: Cash Accounts receivable Inventory Building and equipment, net Accounts payable Common stock Retained earnings $ 7,203 $ 18,800 $ 37,800 $ 123,600 $ 22,425 $ 150,000 $ 14,975 a. The gross margin is 25% of sales b. Actual and budgeted sales data: March (actual) April May $ 47,000 $ 63,000 $ 68,000 $ 93,000 $ 44,000 June July c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. Type here to search d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold, e. One-half of a month's inventory purchases is paid for in the month of purchase, the other half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory f. Monthly expenses are as follows: commissions, 12% of sales, rent, $2,000 per month other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly Depreciation is $927 per month (includes depreciation on new assets) g. Equipment costing $1,200 will be purchased for cash in April. h. Management would like to maintain a minimum cash balance of at least $4,000 at the end of each month. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $20,000. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter. Required: Type here to search