This is an assignment that I need help with, perhaps the whole assignment. I do understand that its probably a lot of calculation so I'll update the price based on it if it's reasonable.

The Pastry Hut The Pastry Hut (PH) sells a wide variety of pastries on the west end of St. Croix. The budget you are to prepare is for the first quarter of the calendar year (January, February & March). Expected Sales Sales in November were $35,000. Monthly sales are forecasted as follows: December January February March April $25,000 $28,000 $30,000 $33,000 $24,000 Customers pay 80% of the sales in cash and 20% of the sales are on credit. Collection of credit sales are in the month following the month of the sale. The $5,000 in accounts receivable on December 31 represents credit sales made in December. Uncollectable accounts are ignored. Balance Sheet The following is the balance sheet as of December 31: Assets Cash Accounts Receivable Inventory Equipment & Fixtures Accumulated Depreciation Total Assets $10,000 5,000 4,200 12,000 (1,200) $30,000 Liabilities Accounts payable Accrued wages Total Liabilities $ 7,950 5,250 Owner's Equity Total Liabilities & Owner's Equity 16,800 $30,000 Planned Inventory Levels PH maintains a raw material inventory amount equal to 50% of the cost of goods sold for the following month. The costs of merchandise sold averages 30% of sales. The inventory on December 31 is 50% of the cost of goods sold for January (.5*.3*28000). Pastry Hut pays for its purchases in the month following the purchase. Wages PH pays wages twice a month, with payments lagging half a month after they are earned. The monthly wages are $10,500. The accrued wages on December 31 ($5,250) represents the unpaid half of December's wages. Capital Expenditures and Operating Expenditures PH plans to buy new fixtures for $12,000 Cash in January. PH has other month expenses as follows: Miscellaneous expenses Rent Depreciation (including new fixtures) 2% of sales, paid as incurred $1,500, paid as incurred $225 per month Cash Balances To meet cash needs, PH has used short term loans from local banks paying them back as cash comes in. Assume that PH wants to maintain a minimum $10,000 cash balance at the end of each month and can borrow or repay loans in multiples of $1,000. The borrowing occurs at the beginning and the repayment at the end of the months in question. PH pays interest in cash at the time it repays the related loan. The interest rate is 6% per year. Required: 1. Using the data given, prepare the following budgets and schedules for each of the months of the planning horizon a. Sales budget b. Cash collections c. Purchases and cost of goods sold budget d. Cash disbursements for purchases e. Operating expense budget f. Cash disbursements for operating expenses 2. Using the budgets and schedules prepare a budgeted income statement for the three months January through March. 3. Prepare the following budgets and forecasted income statements a. Capital budget b. Cash budget (including details of borrowings, repayments and interest for each month) c. Budgeted balance sheet as of March 31. Solution: Sales Budget for the Quarter ended March 31 Expected Sales January February March 28000 30000 33000 Cash Collection for the Quarter ended March 31 Cash Sales Collection from credit sales of previous month January February March 22400 24000 26400 5000 5600 6000 Purchases and cost of goods sold budget Cost of goods sold Beginning Inventory Closing Inventory Purchases January February March Total 8400 9000 9900 4200 4500 4950 4500 4950 3600 8700 9450 8550 26700 Purchases = COGS - Beginning Inventory + Closing Inventory Cash Disbursement for Purchases It is assumed that accounts payable from Balance Sheet dated December 31 are related only to purchased January February March Total 7950 8700 9450 26100 Cash Disbursement for Operating Expense Wages Misc Expenses Rent Total January February March 10500 10500 10500 560 600 660 1500 1500 1500 12560 12600 12660 Operating Expense Budget Wages MiscExps Rent Depreciation Total January February March 10500 10500 10500 560 600 660 1500 1500 1500 225 225 225 12785 12825 12885 Budgeted Income statement for the Quarter Ended March January February March Sales 28000 30000 33000 Less: Cost of Goods sold 8400 9000 9900 Gross Profit 19600 21000 23100 Operating Expenses Wages 10500 10500 10500 Misc. Expenses 560 600 660 Rent 1500 1500 1500 Depreciation Interest Net Income 225 30 6785 225 30 8145 225 10215 Capital Expenditure Budget Purchase of Fixtures January February 12000 March Cash Budget Opening Balance Cash Collection Less: Cash Disbursement For Purchases For Operating Expenses For Fixtures Amount remaining Balance required Amount Borrowed Amount repaid Closing Balance Balance Sheet for the Quarter ended March 31 Assets: Cash Accounts receivables Inventory Fixtures Accumulated Depreciation Total Assets Liabilities Accounts payable Accured Wages Owner's Equity 16800 Add Net Income 25145 Total Liabilities and Dstockholder's Equity January February March 10000 10215 27400 29600 32400 8400 12785 12000 4215 10000 6000 10215 23420 6600 3600 24000 -1875 55745 8550 5250 41945 55745 840 12825 9000 12885 6000 12590 10515 25145 Solution: Sales Budget for the Quarter ended March 31 Expected Sales January February March 28000 30000 33000 Cash Collection for the Quarter ended March 31 Cash Sales Collection from credit sales of previous month January February March 22400 24000 26400 5000 5600 6000 Purchases and cost of goods sold budget Cost of goods sold Beginning Inventory Closing Inventory Purchases January February March Total 8400 9000 9900 4200 4500 4950 4500 4950 3600 8700 9450 8550 26700 Purchases = COGS - Beginning Inventory + Closing Inventory Cash Disbursement for Purchases It is assumed that accounts payable from Balance Sheet dated December 31 are related only to purchased January February March Total 7950 8700 9450 26100 Cash Disbursement for Operating Expense Wages Misc Expenses Rent Total January February March 10500 10500 10500 560 600 660 1500 1500 1500 12560 12600 12660 Operating Expense Budget Wages MiscExps Rent Depreciation Total January February March 10500 10500 10500 560 600 660 1500 1500 1500 225 225 225 12785 12825 12885 Budgeted Income statement for the Quarter Ended March January February March Sales 28000 30000 33000 Less: Cost of Goods sold 8400 9000 9900 Gross Profit 19600 21000 23100 Operating Expenses Wages 10500 10500 10500 Misc. Expenses 560 600 660 Rent 1500 1500 1500 Depreciation 225 225 225 Interest 30 30 Net Income 6785 8145 10215 Capital Expenditure Budget Purchase of Fixtures January February March 12000 Cash Budget Opening Balance Cash Collection Less: Cash Disbursement For Purchases For Operating Expenses For Fixtures Amount remaining Balance required Amount Borrowed Amount repaid Closing Balance Balance Sheet for the Quarter ended March 31 Assets: Cash Accounts receivables Inventory Fixtures Accumulated Depreciation Total Assets Liabilities January February March 10000 10215 27400 29600 32400 8400 12785 12000 4215 10000 6000 10215 23420 6600 3600 24000 -1875 55745 840 12825 9000 12885 6000 12590 10515 25145 Accounts payable Accured Wages Owner's Equity 16800 Add Net Income 25145 Total Liabilities and Dstockholder's Equity 8550 5250 41945 55745