Paul s Pool Service provides pool cleaning chemical application and pool
Paul’s Pool Service provides pool cleaning, chemical application, and pool repairs for residential customers. Clients are billed weekly for services provided and usually pay 60 percent of their fees in the month the service is provided. In the month following service, Paul collects 35 percent of service fees. The final 5 percent is collected in the second month following service. Paul purchases his supplies on credit, and pays 50 percent in the month of purchase and the remaining 50 percent in the month following purchase. Of the supplies Paul purchases, 85 percent is used in the month of purchase, and the remainder is used in the month following purchase.
The following information is available for the months of June, July, and August, which are
Paul’s busiest months:
• June 1 cash balance $14,600.
• June 1 supplies on hand $3,800.
• June 1 accounts receivable $8,000.
• June 1 accounts payable $3,700.
• Estimated sales for June, July, and August are $24,000, $36,000, and $38,000, respectively.
• Sales during May were $22,000, and sales during April were $16,000.
• Estimated purchases for June, July, and August are $9,000, $17,000, and $12,000, respectively.
• Purchases in May were $5,000.

1. Prepare budgeted cash receipts and budgeted cash payments for each month.
2. Compute the balances necessary to prepare a budgeted balance sheet for August 31 for each of the following accounts:
• Cash
• Supplies Inventory
• Accounts Receivable
• Accounts Payable

Membership TRY NOW
  • Access to 800,000+ Textbook Solutions
  • Ask any question from 24/7 available
  • Live Video Consultation with Tutors
  • 50,000+ Answers by Tutors
Relevant Tutors available to help