Question

Saved automatic | Che Required information [The following information applies to the questions displayed below] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: Beech Corporation Balance Sheet June 30 Assets Cash $ 96,000 139,000 70,200 228,000 $ 533,200 Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stokkholders Equity Accounts payable Conmon stock Retained earnings Total liabilities and atockholdera' equity ৪9, 000 333,000 111,200 $ 533,200 Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $390,000, $410,000, $400,000, and $420,000, respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 45 % in the month of sale and 55 % in the month following the sale. All of the accounts receivable at June 30 will be collected in July. 3. Each month's ending inventory must equal 20 % of the cost of next month's sales. The cost of goods sold is 60 % of sales. The company pays for 30 % of its merchandise purchases in the month of the purchase and the remaining 70 % in the month following the purchase. All of the accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $54,000. Each month $7000 of this total amount is depreciation expense and the remaininn t47000 relatec to evnences that are naid in the mnnth thou are incurrad Prev of 9 Next> S4

Answer 1

Solution 1:

Schedule of expected cash collection - Beech Corporation
Particulars	July	August	September	Total
Accounts Receivables from June	$139,000.00			$139,000.00
Cash received for July Sale	$175,500.00	$214,500.00		$390,000.00
Cash received for August Sale		$184,500.00	$225,500.00	$410,000.00
Cash received for September Sale			$180,000.00	$180,000.00
Budgeted Cash Collection	$314,500.00	$399,000.00	$405,500.00	$1,119,000.00

Solution 2:

Material Purchase Budget - Beech Corporation
Particulars	July	August	September	Total
Budgeted Cost of goods sold	$234,000.00	$246,000.00	$240,000.00	$720,000.00
Add: Desired ending merchandise inventory	$49,200.00	$48,000.00	$50,400.00	$50,400.00
Total Needs	$283,200.00	$294,000.00	$290,400.00	$770,400.00
Less: Opening Inventory	$70,200.00	$49,200.00	$48,000.00	$70,200.00
Required purchases	$213,000.00	$244,800.00	$242,400.00	$700,200.00

Schedule of expected cash disbursement for merchandise purchases - Beech Corporation
Particulars	July	August	September	Total
Payables from June	$89,000.00			$89,000.00
July Purchases	$63,900.00	$149,100.00		$213,000.00
August Purchases		$73,440.00	$171,360.00	$244,800.00
September Purchases			$72,720.00	$72,720.00
Total payments in month	$152,900.00	$222,540.00	$244,080.00	$619,520.00

Solution 3:

Income Statement - Beech Corporation
For Quarter Ended - September 30
Particulars	Amount
Sales	$1,200,000.00
Cost of Sales	$720,000.00
Gross Profit	$480,000.00
Operating Expenses:
Selling and adminstrative expenses	$162,000.00
Net Income	$318,000.00

Solution 4:

Balance Sheet- Beech Corporation
30-Sep
Particulars	Amount
Assets:
Cash ($96,000 + $1,119,000 - $619,520 - $141,000	$454,480.00
Accounts receivables ($400,000*55%)	$220,000.00
Inventory	$50,400.00
Plant and equipment net of depreciation ($228,000 - $21,000)	$207,000.00
Total Assets	$931,880.00
Liabilities and stockholder's Equity:
Accounts payable ($242,400*70%)	$169,680.00
Common Stock	$333,000.00
Retained Earnings ($111,200 + $318,000)	$429,200.00
Total liabilities and stockholders equity	$931,880.00