Question

i need req 1,2,3,4 &5 please

5 Cash Accounts receivable 216,800 Inventory Buildings and equipment (net) Accounts payable Common stock Retained earnings $61,000 60,900 371,000 10 points $ 91,425 500,000 118,275 $709,700 $709,700 b. Actual sales for December and budgeted sales for the next four months are as follows: December (actual)$271,000 January February March $406,000 $603,000 $318,000 $214,000 April C. Sales are 20% for cash and 80% on credit. All payments on credit sales are collected in the month following sale. The accounts receivable at December 31 are a result of December credit sales. d. The company's gross margin is 40% of sales. (In other words, cost of goods sold is 60% of sales) e. Monthly expenses are budgeted as follows: salaries and wages, $36,000 per month: advertising, $60,000 per month. Shipping, 5% of sales; other expenses, 3% of sales. Depreciation, including depreciation on new assets acquired during the quarter, will be $45,460 for the quarter f. Each month's ending inventory should equal 25% of the following month's cost of goods sold g. One-half of a month's inventory purchases is paid for in the month of purchase; the other half is paid in the following h. During February, the company will purchase a new copy machine for $3,100 cash. During March, other equipment will i. During January, the company will declare and pay $45,000 in cash dividends month. be purchased for cash at a cost of $80,500 j. Management wants to maintain a minimum cash balance of $30,000. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company would as far as it is able, repay the loan plus accumulated interest at the end of the quarter Required Using the data above, complete the following statements and schedules for the first quarter 1. Schedule of expected cash collections: 2-a. Merchandise purchases budget: 2-b. Schedule of expected cash disbursements for merchandise purchases: 3. Cash budget 4. Prepare an absorption costing income statement for the quarter ending March 31 5. Prepare a balance sheet as of March 31.

Answer 1

Schedule of Expected Cash Collections
	Jan	Feb	Mar	Quarter	Apr
Total sales T	406000	603000	318000	1327000	214000
Cash Sales (20% for cash) S	81200	120600	63600	265400
Credit Sales (T-S)	216800	324800	482400	1024000
Total Collections	298000	445400	546000	1289400
Merchandise Purchases Budget
	Jan	Feb	Mar	Quarter	Apr
Budgeted Cost of Goods Sold (60%*sales)	$243,600	$361,800	$190,800	$796,200	$128,400
Add Desired Ending Inventory (25%*next COGS	$90,450	$47,700	$32,100.0	$32,100.0
Total Needs	$334,050	$409,500	$222,900	$828,300
Less Beginning Inventory	$60,900	$90,450	$47,700	$60,900
Required Purcahses	$273,150	$319,050	$175,200	$767,400
Schedule of Expected Cash Disbursements- Merchandise Purchases
(50% in same month and 50% in next month)	Jan	Feb	Mar	Quarter
Dec Purchases	$91,425			$91,425
Jan purchases	$136,575	$136,575		$273,150
Feb Purchases		$159,525	$159,525	$319,050
Mar Purchases			$87,600	$87,600
Total Disbursements	$228,000	$296,100	$247,125	$771,225
Cash Budget
	Jan	Feb	Mar	Quarter
Beginnning Cash Balance	61,000	$30,520	$32,480	61,000
Add Cash Collections	298,000	445,400	546,000	1,289,400
Total Cash Avail	359,000	475,920	578,480	1,350,400
Less Cash Disbursements
For Inventory	$228,000	$296,100	$247,125	$771,225
For Expenses	128480	144240	121440	394160
For Dividend	45000			45000
For Equipment		3100	80500	83600
Total Cash Disbursements	$401,480	$443,440	$449,065	$1,293,985
Excess(Deficiency) of Cash	($42,480)	$32,480	$129,415	$56,415
Financing:
Borrowings: (42480+30000 for jan)	73000	0		73000
Repayments:			-73000	-73000
Interest:			-2190	-2190
Total Financing	73000	0	-75190	-2190
Ending Cash Balance	$30,520	$32,480	$54,225	$54,225
Interest 73000*3%=2190
working
Expenses
	Jan	Feb	Mar	Quarter
Saalries & wages	36000	36000	36000	108000
Advertising exp	60000	60000	60000	180000
Shipping exp(5% * S)	20300	30150	15900	66350
Other expenses (3%*sales)	12180	18090	9540	39810
Total cash expenses	128480	144240	121440	394160
Income statement
sales		1327000
Less;: Cost of Good sold		$796,200
Gross profit		$530,800
Less: S & A exp
Saalries & wages	108000
Advertising exp	180000
Shipping exp(5% * S)	66350
Other expenses (3%*sales)	39810
Depreciatin	45460
Total S & A exp		439620
Net operating income		$91,180
Interest exp		2190
Net Income		$88,990
Balance sheet
Current assets
Cash		54,225
Accounts receivable		254,400
Inventory		32,100
Total Current assets		340,725
Building and equipment, net (371000+83600-45460)		409140
Total assets		749,865
Liabilities & stockholder equity
Current liabilities
Accounts payable		87,600
stockholder equity
Common stock	500000
Retained earnings (118275+88990-45000)	$162,265
Totl stockholder equity		$662,265
Total Liabilities & stockholder equity		$749,865