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The following information relates to a company, Budgeted monthly absorption costing income statements for July-September are, July August September Sales $ 580,000 $ 700,000 $400,000

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The following information relates to a company, Budgeted monthly absorption costing income statements for July-September are, July August September Sales $ 580,000 $ 700,000 $400,000 Cost of goods sold 405,000 546,000 282.ee Gross margin 174,000 234,00 120,00 Selling and administrative expenses Selling expense 78,290 9.de 59,eae Administrative expense 44,00 59,200 36,800 Total selling and administrative expenses 122 200 157,200 95,800 Net operating income $ 52,000 $ 76,800 $ 24,200 includes $21000 of depreciation each month. (Hint: Remember that depreciation is a non-cash expense so it doesn't belong on your cash budget) Additional information: Sales are 20% for cash and 80% on account Soles on account are collected over a three-month period with 10% collected in the month of sale, 70% collected in the first month following the month of sale, and the remaining 20% collected in the second month following the month of sale, Mays sales totaled $195.000, and Junes sales totaled $200,000 The company puys for 50% of inventory purchases in the month of purchase and the remaining 50s the following month Accounts payable at June 30 for inventory purchases during June total $107,800 Budgeted Inventory purchases for the quarter are $434,000 August $492.800 September $277.200 July . In July the company will declare and pay dividends of $28.000 . in August the company will pay cash for land costing $36.000 . On June 30, the cash balance is $50,000, the company must maintain a cash balance of at least $40.000 at the end of each month . On June 30, the cash balance is $50,000, the company must maintain a cash balance of at least $40.000 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. The interest rate on these loans is 1% per month simple interest. Any money borrowed will be paid back with interest on the last day of the quarter. Required: 1. Prepare a schedule of expected cash collections for July, August, September, and the quarter in total. 2. Prepare a schedule of expected cash disbursements for inventory purchases for July August, September and the quarter in total, 3. Prepare a cash budget for July August, September, and the quarter in total Complete this question by entering your answers in the tabs below. Required 1 Required 2B Required 3 Prepare a schedule of expected cash collections for July August September, and the quarter in total Schedule of Expected Cash Collections July August September Quarter Cash sales Sales on account May June July August September Total cash collections Required 1 Required 28 > The company has an agreement with a local bank that allows the company to borrow in increments of $1.000 at the beginnin each month. The interest rate on these loans is 1% per month simple interest. Any money borrowed will be paid back with interest on the last day of the quarter, Required: 1. Prepare a schedule of expected cash collections for July, August, September, and the quarter in total. 2. Prepare a schedule of expected cash disbursements for inventory purchases for July August September and the quarter in total 3. Prepare a cash budget for July, August September, and the quarter in total. Complete this question by entering your answers in the tabs below. Required 1 Required 28 Required 3 Prepare a schedule of expected cash disbursements for inventory purchases for July, August, September and the quarter in total. Schedule of Expected Cash Disbursements for Inventory Purchases July August September Quarter July purchases August purchases September purchases Total cash disbursements Required 1 Required 2B Required 3 Prepare a cash budget for July, August, September, and the quarter in total. (Cash deficiency, repayments and interest should be Indicated by a minus sign.) September Quarter Company Cash Budget For the Quarter Ended September 30 July August Beginning cash balance Add collections from customers Total cash available Less cash disbursements Inventory purchases Selling expenses Administrative expenses Land purchases Dividends paid Total cash disbursements Excess (deficiency of cash available over disbursements Financing: Borrowings Repayment interest Total financing Ending cash balance

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