Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Wed Aug 4 AA VoiceThread a ezto.mheducation.com G TestFirst Hirin week One Auch Week 4: Homework devry 72 Mearaw Hill - 1 1 Question s

image text in transcribed
Wed Aug 4 AA VoiceThread a ezto.mheducation.com G TestFirst Hirin week One Auch Week 4: Homework devry 72 Mearaw Hill - 1 1 Question s . W.. d queen murphy saved Help Save & Exit Submit 5 Deacon Company is a merchandising company that is preparing a budget for the three-month period ended June 30th. The following information is available Check my work Deacon Company 10 Balance Sheet points Assets March 31 Skipped Cash Accounts receivable 56, 000 Inventory 36 , 400 Buildings and equipment, net of depreciation 62 , 800 Total assets 199, 000 eBook $ 354, 200 Liabilities and Stockholders' Equity Accounts payable Common stock $ 172, 100 Retained earnings 70, 000 Print 112, 100 Total liabilities and stockholders' equity $ 354, 200 References Budgeted Income Statements April May June Sales $176, 000 $186, 000 $206, 000 Cost of goods sold 105 , 600 111, 600 123, 600 Gross margin 70 , 400 74 , 400 82 , 400 Selling and administrative expenses 19, 800 21, 300 24 , 300 Net operating income $ 50, 600 $ 53, 100 $ 58, 100 Budgeting Assumptions: a. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80% are collected in the month subsequent to the sale. b. Budgeted sales for July are $216,000. c. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. The accounts payable at March 31 will be paid in April. d. Each month's ending merchandise inventory should equal $10,000 plus 50% of the next month's cost of goods sold e. Depreciation expense is $1,450 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred. Required: 1. Calculate the expected cash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30th. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30th balance sheet.) Complete this question by entering your answers in the tabs below. Required 2 Required 3 Required 4 Required 1 Calculate the expected cash collections for April, May, and June. Next

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

Step: 3

blur-text-image

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

Financial Accounting

Authors: Carl S Warren, James M Reeve, Jonathan Duchac

12th Edition

0538478519, 9780538478519

More Books

Students also viewed these Accounting questions