Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below. Beech Corporation Balance Sheet June 30 Assets Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 82,000 129, eee 52,500 217,000 $ 480,500 $78,000 347 , ??? 55,500 $ 480,500 Beech's managers have made the following additional assumptions and estimates 1. Estimated sales for July, August September, and October will be $280,000, $300,000, $290,000, and $310,000, respectively 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July 3. Each month's ending inventory must equal 25% of the cost of next month's sales. The cost of goods sold is 75% of sales. The company pays for 40% of us merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July 4. Monthly selling and administrative expenses are always $52,000. Each month $5,000 of this total amount is depreciation expense and the remaining $47.000 relates to expenses that are paid in the month they are incurred 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. Required: 1. Prepare a schedule of expected cash collections for July, August, and September 2-a Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30, 2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September 3. Prepare an Income statement that computes net operating income for the quarter ended September 30 4. Prepare a balance sheet as of September 30, Prepare a schedule of expected cash collections for July, August, and September. $ Schedule of Expected Cash Collections Month July August September Quarter From accounts receivable 0$ 0 0 $ 0 From July sales 98,000 182,000 0 280,000 From August sales 0 105,000 195,000 300,000 From September sales 0 0 101,500 101,500 Total cash collections $ 98,000 $ 287,000 $ 296,500 $ 681,500 K Regi Req 2A > Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. Merchandise Purchases Budget July August September Quarter Total needs Required purchases Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September Schedule of Cash Disbursements for Purchases July August September Quarter $ From July purchases From August purchases From September purchases Total cash disbursements $ 0 $ 0 $ 0 $ 0 OOOO 0 Prepare an income statement that computes net operating income for the quarter ended September 30. Beech Corporation Income Statement For the Quarter Ended September 30 $ 0 Prepare a balance sheet as of September 30. Beech Corporation Balance Sheet September 30 Assets s Total assets $ 0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Survey Of Accounting

Authors: Paul D. Kimmel, Jerry J. Weygandt

2nd Edition

1119594537, 978-1119594536

More Books

Students also viewed these Accounting questions

Question

1. To generate a discussion on the concept of roles

Answered: 1 week ago