Near the end of 2019, the management of Dimsdale Sports Co., a
merchandising company, prepared the following estimated balance
sheet for December 31, 2019.
DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 |
||||||
Assets | ||||||
Cash | $ | 36,000 | ||||
Accounts receivable | 520,000 | |||||
Inventory | 100,000 | |||||
Total current assets | $ | 656,000 | ||||
Equipment | 528,000 | |||||
Less: Accumulated depreciation | 66,000 | |||||
Equipment, net | 462,000 | |||||
Total assets | $ | 1,118,000 | ||||
Liabilities and Equity | ||||||
Accounts payable | $ | 365,000 | ||||
Bank loan payable | 14,000 | |||||
Taxes payable (due 3/15/2020) | 89,000 | |||||
Total liabilities | $ | 468,000 | ||||
Common stock | 473,500 | |||||
Retained earnings | 176,500 | |||||
Total stockholders’ equity | 650,000 | |||||
Total liabilities and equity | $ | 1,118,000 | ||||
To prepare a master budget for January, February, and March of
2020, management gathers the following information.
Required:
Prepare a master budget for each of the first three months of 2020;
include the following component budgets.
1. Monthly sales budgets.
2. Monthly merchandise purchases budgets.
3. Monthly selling expense budgets.
4. Monthly general and administrative expense
budgets.
5. Monthly capital expenditures budgets.
6. Monthly cash budgets.
7. Budgeted income statement for the entire first
quarter (not for each month).
8. Budgeted balance sheet as of March 31,
2020.
1) | |||
DIMSDALE SPORTS CO. | |||
Sales Budget | |||
For January, February and March 2020 | |||
Budgeted Unit Sales (a) | Budgeted Unit Price (b) | Budgeted Total Dollars (a*b) | |
January | 6,750 | $59 | $398,250 |
February | 9,250 | $59 | $545,750 |
March | 11,250 | $59 | $663,750 |
Totals for the quarter | 27,250 | $1,607,750 | |
2) | |||
DIMSDALE SPORTS CO. | |||
Merchandise Purchases Budget | |||
January, February and March 2020 | |||
January | February | March | |
Next month's budgeted sales (units) (a) | 9,250 | 11,250 | 9,000 |
Ratio of inventory to future sales (b) | 20% | 20% | 20% |
Estimated ending inventory (a*b) | 1,850 | 2,250 | 1,800 |
Add: Budgeted sales in units | 6,750 | 9,250 | 11,250 |
Required units of available merchandise | 8,600 | 11,500 | 13,050 |
Less: Beginning inventory (last month's ending inventory is the beginning inventory in current month) | 5,000 | 1,850 | 2,250 |
Units to be purchased (d) | 3,600 | 9,650 | 10,800 |
Cost of unit purchased (e ) | $20 | $20 | $20 |
Total cost of Units Purchased (d * e) | $72,000 | $193,000 | $216,000 |
3) | |||
DIMSDALE SPORTS CO. | |||
Selling Expense Budget | |||
January, February and March 2020 | |||
January | February | March | |
Budgeted sales (a) | $398,250 | $545,750 | $663,750 |
Percentage of sales commissions (b) | 20% | ||
Sales commissions (a*b) | $79,650 | $109,150 | $132,750 |
Sales Salaries | $72,000 | ||
Total Selling Expenses | $151,650 | $109,150 | $132,750 |
4) | |||
January | February | March | |
Equipment - beginning of month | $528,000 | $566,400 | $660,000 |
Add: Equipment purchases | $38,400 | $93,600 | $21,600 |
Equipment - end of month | $566,400 | $660,000 | $681,600 |
DIMSDALE SPORTS CO. | |||
General and Administrative Expense Budget | |||
January, February and March 2020 | |||
January | February | March | |
General and Administrative salaries | $156,000 | ||
Maintenance expense | $2,100 | $2,100 | $2,100 |
Total General and Administrative Expenses | $158,100 | $2,100 | $2,100 |
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,500 Accounts receivable 520,000 Inventory 105,000 Total current assets $ 661,500 Equipment 612,000 Less: Accumulated depreciation 76,500 Equipment, net 535,500 Total assets $ 1,197,000 Liabilities and Equity Accounts payable $ 375,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 89,000 Total liabilities $ 476,000...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,500 Accounts receivable 520,000 Inventory 105,000 Total current assets $ 661,500 Equipment 612,000 Less: Accumulated depreciation 76,500 Equipment, net 535,500 Total assets $ 1,197,000 Liabilities and Equity Accounts payable $ 375,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 89,000 Total liabilities $ 476,000...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,000 Accounts receivable 520,000 Inventory 135,000 Total current assets $ 691,000 Equipment 600,000 Less: Accumulated depreciation 75,000 Equipment, net 525,000 Total assets $ 1,216,000 Liabilities and Equity Accounts payable $ 340,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 88,000 Total liabilities $ 440,000...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,000 Accounts receivable 520,000 Inventory 135,000 Total current assets $ 691,000 Equipment 600,000 Less: Accumulated depreciation 75,000 Equipment, net 525,000 Total assets $ 1,216,000 Liabilities and Equity Accounts payable $ 340,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 88,000 Total liabilities $ 440,000...
Near the end of 2017, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2017 DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2017 Assets Cash Accounts receivable Inventory Total current assets Equipment Less accumulated depreciation $36, 500 520,000 95,00 $651, 500 528,000 66.000 Equipment, net Total assets 462,000 1,113,500 Liabilities and Equity Accounts payable Bank loan payable Taxes payable (due 3/15/2018) Total liabilities Common stock Retained earnings Total stockholders equity...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 35,500 Accounts receivable 520,000 Inventory 100,000 Total current assets $ 655,500 Equipment 540,000 Less: Accumulated depreciation 67,500 Equipment, net 472,500 Total assets $ 1,128,500 Liabilities and Equity Accounts payable $ 365,000 Bank loan payable 13,000 Taxes payable (due 3/15/2020) 89,000 Total liabilities $ 467,000...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,000 Accounts receivable 520,000 Inventory 135,000 Total current assets $ 691,000 Equipment 600,000 Less: Accumulated depreciation 75,000 Equipment, net 525,000 Total assets $ 1,216,000 Liabilities and Equity Accounts payable $ 340,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 88,000 Total liabilities $ 440,000...
Near the end of 2017, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2017 DİMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2017 Assets Cash $ 35,000 142,500 588,000 Accounts receivable Total current assets $ 697,500 Equipment Less: accumulated depreciation Total assets Accounts payable 73,500 Equipment, net 514,500 S 1,212,000 Liabilities and Equity 360,00 16,000 92,000 Bank loan payable axes payable (due 3/15/2018) Common stock Total stockholders' equity $468,000 1...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,500 Accounts receivable 520,000 Inventory 105,000 Total current assets $ 661,500 Equipment 588,000 Less: Accumulated depreciation 73,500 Equipment, net 514,500 Total assets $ 1,176,000 Liabilities and Equity Accounts payable $ 380,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 91,000 Total liabilities $ 483,000...
Near the end of 2019, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2019. DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2019 Assets Cash $ 36,500 Accounts receivable 520,000 Inventory 105,000 Total current assets $ 661,500 Equipment 588,000 Less: Accumulated depreciation 73,500 Equipment, net 514,500 Total assets $ 1,176,000 Liabilities and Equity Accounts payable $ 380,000 Bank loan payable 12,000 Taxes payable (due 3/15/2020) 91,000 Total liabilities $ 483,000...