Sky High Parachute Company sells parachutes. As of January 1, Sky High had no beginning merchandise inventory. In the first quarter of 2020, Sky High sold 6,500 parachutes. The company’s sales forecast for the remainder of 2020 (in units) is:
Quarter 2: 7,000 Quarter 3: 7,500 Quarter 4: 9,000
Sky High’s selling price is $400 per parachute. All sales are credit sales. Sky High collects 85% of its sales in the quarter in which it made the sales and the remaining 15% in the following quarter.
As of March 31/April 1, Sky High had 1,300 parachutes in its merchandise inventory that it had purchased for $340 each. Sky High expects to pay its vendor $340 per parachute for the remainder of the year. Sky High plans to have the following number of parachutes in its merchandise inventory at the end of the remaining quarters in 2020.
Quarter 2: 1,500 Quarter 3: 2,000 Quarter 4: 1,000
Sky High buys the parachutes on credit. It pays for half of its purchases in the same quarter as it purchases them and pays the remaining half in the following quarter. Sky High pays for all its other expenses in the same quarter as it incurs them.
Sky High’s budget for variable selling expenses is $10 per each parachute sold. Sky High’s budget for fixed selling, general and administrative expenses is $25,000 each quarter. The $25,000 budget includes $5,000 in depreciation expense each quarter.
Please prepare the following budgets for Sky High for the second quarter of 2020:
a) Sales in dollars
b) Purchases of parachutes in units and dollars
c) Selling and Administrative Expenses in dollars
d) Cash collections (receipts) budget in dollars
e) Cash payments (disbursements) budget in dollars
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Prepare the following budgets for Sky High for the second quarter of 2020.
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support pealk sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are April June July Sales Cost of goods sold Gross margin Selling and administrative expenses $650,000 820,000...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April May June July $ 550,000 $ 750,000 $ 450,000 $ 350,000 385,000 525,000 315,000 245,000...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April May $ 550,000 $750,000 385,000 525,000 165,000 225,000 June $ 450,000 315,000 135,000 July $ 350,000 245,000...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April May June July $ 550,000 $ 750,000 $ 450,000 $ 350,000 385,000 525,000 315,000 245,000...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April $ 550,000 385,000 165,000 May $ 750,000 525,000 225,000 June $ 450,000 315,000 135,000 July...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April May June July $ 670,000 $ 840,000 $ 550,000 $ 450,000 469,000 588,000 385,000 315,000...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: Budgeted monthly absorption costing income statements for April–July are: April May June July Sales $ 590,000 $ 790,000 $ 490,000 $ 390,000 Cost of goods sold...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: Budgeted monthly absorption costing income statements for April–July are: April May June July Sales $ 600,000 $ 900,000 $ 500,000 $ 400,000 Cost of goods sold...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April $ 710,000 497,000 213,000 May $ 880,000 616,000 264,000 June July $ 590,000 $ 490,000...
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April May June July $ 720,000 $ 890,000 $ 600,000 $500,000 504,000 623,000 420,000 350,000 216,000...