Question

Minden Company is a wholesalle distributor of premium European chocolates. The company's balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 9,500 56,500 53,250 234,000 Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets $353,250 Liabilities and Stockholders Equity Accounts payable Note payable Common stock Retained earnings $ 79,000 20,000 180,000 74,250 Total liabilities and stockholders' equity $ 353,250

Answer 1

1-a)	Schedule of Expected cash collection
	Cash sales-May					89,700
	Collections on account receivable
	April 30 balance					56,500
	May sales		(299000-89700)*50%			104650
	total cash recepits					250,850
	Schedule of Expected cash disbursements
	April 30 accounts payable balance					79,000
	May purchases		(169000*40%)			67600
	total cash payments					146,600
1-b)	Cash Budget
	Beginning cash balance					9,500
	Add Collections from customers					250,850
	total cash available					260,350
	less Cash disbursements
	purchase of inventoru					146,600
	selling and administrative expense					89,700
	purchase of Equipment					7,200
	total cash disbursements					243,500
	Excess of cash available over disbursements					16,850
	financing:
	borrowing -note					25,200
	Repayments-note					-20,000
	interest					-320
	total financing					4,880
	Ending cash balance					21,730
	Budgeted income statement
	sales					299,000
	cost of goods sold:
	beginning inventory				53,250
	purchases				169,000
	goods available for sale				222,250
	ending invnetory				42,000
	cost of goods sold:					180,250
	Gross margin					118,750
	Selling and administrative expesne					91,950
	net operating income					26,800
	interest expesne					320
	net income					26,480
	Budgeted balance sheet
	Assets
	Cash					21,730
	Account receivable					104650
	inventory					42,000
	buildings & equipment,net of depreciaiton					238950
	total Assets					407,330
	Laibilities & stockholder's Equity
	Accounts payable					101400
	note payable					25,200
	common stock					180,000
	Retained earnings					100,730
	total liabilities & stockholders equity					407330