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Deacon Company is a merchandising company that is preparing a budget for the three month period ended June 30th. The followin
Budgeting Assumptions: a. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales a
Complete this question by entering your answers in the tabs below. Required 2 Required 1 Required 2 Required 3 Required 4 Cal
Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Calculate the
Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare a budg
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Answer #1
1.) Schedule of expected cash collections for April, May & June:-
Month
April May June Quarter
Collection of accounts receivable at March 31             38,800                       -                   -          38,800
Cash Sales of April             66,600                       -                   -          66,600
April credit sale collection               8,880              35,520                 -          44,400
Cash Sales of May                     -                72,600        72,600
May credit sale collection                     -                  9,680         38,720        48,400
Cash Sales of June                     -                         -           84,600        84,600
June credit sale collection                     -                         -           11,280        11,280
Total cash collections         1,14,280          1,17,800     1,34,600    3,66,680
2..) Merchandise Purchases Budget
Month
April May June Quarter
Cost of goods sold             66,600              72,600         84,600    2,23,800
Closing Inventory             46,300              52,300         55,300    1,53,900
Total Needs         1,12,900          1,24,900     1,39,900    3,77,700
Less: Opening Inventory           -43,300            -46,300       -52,300 -1,41,900
Required purchases            69,600              78,600        87,600    2,35,800
3.) Schedule of cash disbursements for Purchases
Month
April May June Quarter
Payment of accounts payable at March 31             66,200                       -                   -          66,200
April Cash Purchase               6,960                       -                   -            6,960
April Credit Purchase payment                     -                62,640                 -          62,640
May Cash Purchase                     -                  7,860                 -            7,860
May Credit Purchase payment                     -                         -           70,740        70,740
June Cash Purchase                     -                         -             8,760          8,760
Total cash disbursements            73,160              70,500        79,500    2,23,160
4.) Balance Sheet
June 30
Assets Amount in $ Explanation
Cash         1,37,620 (65,200+366,680-223,160-23,300-24,800-27,800+4,800)
Accounts Receivable             45,120 (141,000 x 40% x 80% )
Inventory             55,300 ((151000*0.6)*0.5)+10000
Plant & Equipment, net of depreciation         1,20,200 (125000 - ( 1600 x 3 ))
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