Sports Fanatic Company is a retail sporting goods store that
uses accrual accounting for its records. Information on Sports
Fanatic’s operations are as follows:
1. | The store has budgeted sales at $220,000 for January and $200,000 for February. | |
2. | It expects collections to be 60% in the month of sale and 38% in the month following the sale. It expects 2% of sales to be uncollectible. | |
3. | Gross margin is 25% of sales. | |
4. | It purchases a total of 80% of the merchandise for resale in the month before the month of sale and 20% in the month of sale. It makes payments for merchandise in the month after it purchases it. | |
5. | Other expected monthly expenses to be paid in cash amount to $22,600. | |
6. | Annual depreciation is $216,000. | |
7. | Sports Fanatic’s balance sheet at the close of business on December 31 follows. |
SPORTS FANATIC COMPANY Balance Sheet December 31 |
||
Assets | ||
Cash | $22,000 | |
Accounts receivable (net of $4,000 allowance for uncollectible accounts) | 76,000 | |
Inventory | 132,000 | |
Property, plant, and equipment (net of $680,000 of accumulated depreciation) | 870,000 | |
Total assets | $1,100,000 | |
Liabilities and Shareholders’ Equity | ||
Accounts payable | $162,000 | |
Common shares | 800,000 | |
Retained earnings | 138,000 | |
Total liabilities and shareholders’ equity | $1,100,000 |
1. Prepare the income statement for January. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).
2. Prepare the cash budget for January. (Do not leave any answer field blank. Enter 0 for amounts.
3. Prepare the budgeted balance sheet for January. (List Current Assets in order of liquidity.)
Assets | |
Cash | |
Accounts Receivable | |
Inventory | |
Property, Plant and Equipment | |
Total Assets | |
Liabilities and Shareholder's Equity | |
Accounts Payable | |
Common Shares |
|
Retained Earnings | |
Total Liabilities and Shareholder's Equity |
Sports Fanatic Company is a retail sporting goods store that uses accrual accounting for its records....
Question, Fill in the
blank
Thank you, I really appreciate it!
Case 10-59 Sports Fanatic Company is a retail sporting goods store that uses accrual accounting for its records. Information on Sports Fanatic's operations are as follows: 1. 2. 3. 4. 5. 6. 7. The store has budgeted sales at $220,000 for January and $200,000 for February. It expects collections to be 60% in the month of sale and 38% in the month following the sale. It expects 2% of...
Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: Sales are budgeted at $190,000 for December and $160,000 for January, terms 1/eom, n/60 Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts expense is included...
Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: 1. Sales are budgeted at $330,000 for December and $300,000 for January, terms 1/eom, n/60. • Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts expense...
Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: Sales are budgeted at $190,000 for December and $160,000 for January, terms 1/eom, n/60 Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts expense is included...
Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: Sales are budgeted at $200,000 for December and $170,000 for January, terms 1/eom, n/60. Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts expense is included...
Ch 10, #9 Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: Sales are budgeted at $280,000 for December and $250,000 for January, terms 1/eom, n/60. Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts...
Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: Sales are budgeted at $190,000 for December and $160,000 for January, terms 1/eom, n/60. Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts expense is included...
Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: . Sales are budgeted at $220,000 for December and $190,000 for January, terms 1/eom, n/60 ·Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the month of sale. Bad debts expense is...
10-49 Budgeting for a Merchandising Firm Goldberg Company is a retail sporting goods store that uses an accrual accounting system. Facts regarding its operations follow: • Sales are budgeted at $250,000 for December and $225,000 for January, terms lleom, n/60. . Collections are expected to be 50% in the month of sale and 48% in the month following the sale. Two percent of sales are expected to be uncollectible and recorded in an allowance account at the end of the...
Village Hardware is a retail hardware store. Information about the store's operations follows. • November 20x4 sales amounted to $570,000. • Sales are budgeted at $610,000 for December 20x4 and $570,000 for January 20x5. • Collections are expected to be 70 percent in the month of sale and 28 percent in the month following the sale. Two percent of sales are expected to be uncollectible. Bad debts expense is recognized monthly. • The store’s gross margin is 25 percent of...