Question

Following information relates to Acco Co.

  1. Beginning cash balance on July 1: $30,000.
  2. Cash receipts from sales: 27% is collected in the month of sale, 50% in the next month, and 23% in the second month after sale (uncollectible accounts are negligible and can be ignored). Sales amounts are: May (actual), $1,032,000; June (actual), $720,000; and July (budgeted), $840,000.
  3. Payments on merchandise purchases: 54% in the month of purchase and 46% in the month following purchase. Purchases amounts are: June (actual), $258,000; and July (budgeted), $600,000.
  4. Budgeted cash payments for salaries in July: $126,600.
  5. Budgeted depreciation expense for July: $7,200.
  6. Other cash expenses budgeted for July: $90,000.
  7. Accrued income taxes due in July: $80,000.
  8. Bank loan interest paid in July: $3,960.

Additional Information:

  1. Cost of goods sold is 40% of sales.
  2. Inventory at the end of June is $48,000 and at the end of July is $312,000.
  3. Salaries payable on June 30 are $30,000 and are expected to be $24,000 on July 31.
  4. The equipment account balance is $960,000 on July 31. On June 30, the accumulated depreciation on equipment is $168,000.
  5. The $3,960 cash payment of interest represents the 1% monthly expense on a bank loan of $396,000.
  6. Income taxes payable on July 31 are $98,784, and the income tax rate is 35%.
  7. The only other balance sheet accounts are Common Stock, with a balance of $365,080 on June 30; and Retained Earnings, with a balance of $643,200 on June 30.

  
Prepare a budgeted income statement for the month of July and a budgeted balance sheet for July 31.Calculation Inc Stmt Bal Sheet Calculate the budgeted cash receipts and cash payments. Calculation of Cash Receipts From Sale

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Calculation of Cash receipts from sales Collected In May June July 31. Accounts receivable Total Sales July Credit Sales Fro

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