Question

Green Landscaping Inc. is preparing its budget for the first quarter of 2020. The next step in the budgeting process is to prepare a cash receipts schedule and a cash payments schedule. To that end the following information has been collected.

Clients usually pay 60% of their fee in the month that service is performed, 30% the month after, and 10% the second month after receiving service.

Actual service revenue for 2019 and expected service revenues for 2020 are November 2019, $92,770; December 2019, $84,270; January 2020, $102,860; February 2020, $121,440; and March 2020, $133,780.

Purchases of landscaping supplies (direct materials) are paid 60% in the month of purchase and 40% the following month. Actual purchases for 2019 and expected purchases for 2020 are December 2019, $15,460; January 2020, $13,420; February 2020, $16,790; and March 2020, $22,730.

(a)

Prepare the following schedules for each month in the first quarter of 2020 and for the quarter in total:

(1) Expected collections from clients.

GREEN LANDSCAPING INC Schedule of Expected Collections From Clients February Quart November December January February March Total collections (2) Expected payments for landscaping supplies. GREEN LANDSCAPING INC. Schedule of Expected Payments for Landscaping Supplies Quarter December January February March Total payments

(b)

Determine the following balances at March 31, 2020:

(1)		Accounts receivable		$
(2)		Accounts payable		$

Thank you

Answer 1

(a) Elpected tollections from ctients Quaster Mar feb Jan 9277 November 9247 (92770x 10%) 33,7 0g 25,281 $427 December (94,210X 30%) (94,10o) 10,286 192860 l02%60X E0%) (102 6002o January 61716 Xlc%) 30% 32864 F2 36432 l09296 (121440 (i21440 (D X0%.) abruany 30%)6 T02680 March (13180 x f0%) Tual collections %27 12149 126986 335409

12xpected Paments: fcb Manch Guuarle 6184 Jun December G184 (154OXY0%) 13,420 5368 (BANDXE0) (3120XD7) february 10,074 6716 16790 (16490xE0x) (I6790 к чо) 13,638 13,638 (22730 XG0%) March Total 15,492 2035y S0,032 Payments 14,236 (b) )Accounts Receivable: februnry month Sales amount Seceivable in April ($121440x 10% MaCrch month Sales amount eceivable in April (133780x 30% ) May (133%0x lo7.) Balante at MaIch 31, 2020 12,144 40134 13378 65,656

b2) Accounts Payable March month Purhases umount fayable in April (22/730x40% $१०१2 Balance at March 31,2020 ৭০१2-