What is the budgeted balance sheet as of Dec 2019? Steps on how to get it?
2. Sipia's balance sheet for 30 November 2019 follows. Use it and the following information to prepare a cash budget for Sipia for December 2019 (10 marks): 80% of sales are on account. Out of these sales on account, 50% are collected in the month of the sale, 49% are collected the following month and 1% are never collected and written off as bad debts. All purchases of materials are on account. Sipia pays for 70% of purchases in the month of purchase and 30% in the following month All other costs are paid in the month incurred Sipia is making monthly interest payments of 1% (12% per year) on a $20,000 long-term loan Sipia plans to pay the $500 of taxes owed as of 30 November 2019 in December 2019. Income tax expense for December is zero 40% of processing and set-up costs, and 30% of marketing and general depreciation administration costs, are Sipia Balance Sheet as of 30 November 2019 Assets $2,000 Cash Account receivable $4,800 96 4,704 Less: Allowance for bad debts Inventories: Direct materials 172 Finished goods 990 $190,000 55,759 Fixed assets Less: Accumulated depreciation 134,241 $142.107 Total assets Liabilities and equity Account payable Taxes payable Interest payable Long-term debt Ordinary shares Retained earnings Total liabilities and equity $696 500 200 20,000 10,000 110,711 $142.107 2. Sipia's balance sheet for 30 November 2019 follows. Use it and the following information to prepare a cash budget for Sipia for December 2019 (10 marks): 80% of sales are on account. Out of these sales on account, 50% are collected in the month of the sale, 49% are collected the following month and 1% are never collected and written off as bad debts. All purchases of materials are on account. Sipia pays for 70% of purchases in the month of purchase and 30% in the following month All other costs are paid in the month incurred Sipia is making monthly interest payments of 1% (12% per year) on a $20,000 long-term loan Sipia plans to pay the $500 of taxes owed as of 30 November 2019 in December 2019. Income tax expense for December is zero 40% of processing and set-up costs, and 30% of marketing and general depreciation administration costs, are Sipia Balance Sheet as of 30 November 2019 Assets $2,000 Cash Account receivable $4,800 96 4,704 Less: Allowance for bad debts Inventories: Direct materials 172 Finished goods 990 $190,000 55,759 Fixed assets Less: Accumulated depreciation 134,241 $142.107 Total assets Liabilities and equity Account payable Taxes payable Interest payable Long-term debt Ordinary shares Retained earnings Total liabilities and equity $696 500 200 20,000 10,000 110,711 $142.107
