Q No.16 Abbas runs a business which retails high quality clothing. It is particularly busy during...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Q No.16 Abbas runs a business which retails high quality clothing. It is particularly busy during the festive season. The budgeted sales and purchases figures for September 2012 to January 2013 are as follows: September Rs. October Rs. November December Rs. Rs. January Rs. Sales Purchases 215 000 225 000 310 000 425 000 195.000 175 000 190 000 245 000 135 000 135.000 Additional information: 150% of sales are expected to be paid for by cash and these customers will receive a 6% discount. 50% of the remaining sales are expected to be paid in the following month and these customers will receive a 3% discount. The remainder will pay 2 months after the sale. 230% of purchases are expected to be paid for in the month of purchase and will receive a 4% discount. 40% of purchases are expected to be paid for in the month after purchase and will receive a 2% discount. The remainder are paid for 2 months after purchase. 3 The inventories held on 1 November 2012 are budgeted at Rs. 180 000. The inventories held on 31 January 2013 are budgeted at Rs. 129 000. 4 Total general expenses are budgeted at Rs. 18 000 in November 2012 with an expected 10% rise in December and a 15% reduction (on the December total) in January 2013. All general expenses are expected to be paid in full in the month in which they occur. 5 The depreciation on the non-current assets acquired before November 2012 will be Rs.1 750 per month. 6 On 1 November 2012 Abbas will acquire a new storage system at a cost of Rs.24 000 and will pay 50% of the cost immediately. The remainder will be paid in equal installments over the following 12 months without any interest charges. This new non-current asset will be depreciated at 10% per annum on a monthly basis. 7 Abbas will make drawings of Rs.3 000 every month except for December 2012. In this month she expects to draw 1.5% of the month's expected sales. 8 The bank balance at 1 November 2012 is expected to be Rs.34 850. REQUIRED: (a) Prepare a cash budget, in columnar format, for the 3 months commencing with November 2012. (b) Prepare a budgeted income statement (profit and loss account) in as much detail as possible from the given information for this 3 month period ending in January 2013. Q No.16 Abbas runs a business which retails high quality clothing. It is particularly busy during the festive season. The budgeted sales and purchases figures for September 2012 to January 2013 are as follows: September Rs. October Rs. November December Rs. Rs. January Rs. Sales Purchases 215 000 225 000 310 000 425 000 195.000 175 000 190 000 245 000 135 000 135.000 Additional information: 150% of sales are expected to be paid for by cash and these customers will receive a 6% discount. 50% of the remaining sales are expected to be paid in the following month and these customers will receive a 3% discount. The remainder will pay 2 months after the sale. 230% of purchases are expected to be paid for in the month of purchase and will receive a 4% discount. 40% of purchases are expected to be paid for in the month after purchase and will receive a 2% discount. The remainder are paid for 2 months after purchase. 3 The inventories held on 1 November 2012 are budgeted at Rs. 180 000. The inventories held on 31 January 2013 are budgeted at Rs. 129 000. 4 Total general expenses are budgeted at Rs. 18 000 in November 2012 with an expected 10% rise in December and a 15% reduction (on the December total) in January 2013. All general expenses are expected to be paid in full in the month in which they occur. 5 The depreciation on the non-current assets acquired before November 2012 will be Rs.1 750 per month. 6 On 1 November 2012 Abbas will acquire a new storage system at a cost of Rs.24 000 and will pay 50% of the cost immediately. The remainder will be paid in equal installments over the following 12 months without any interest charges. This new non-current asset will be depreciated at 10% per annum on a monthly basis. 7 Abbas will make drawings of Rs.3 000 every month except for December 2012. In this month she expects to draw 1.5% of the month's expected sales. 8 The bank balance at 1 November 2012 is expected to be Rs.34 850. REQUIRED: (a) Prepare a cash budget, in columnar format, for the 3 months commencing with November 2012. (b) Prepare a budgeted income statement (profit and loss account) in as much detail as possible from the given information for this 3 month period ending in January 2013.
Expert Answer:
Answer rating: 100% (QA)
Cash Budget November 2012 January 2013 Description November December January Total Opening Balance 3... View the full answer
Related Book For
Principles Of Macroeconomics
ISBN: 9781292303826
13th Global Edition
Authors: Karl E. Case,Ray C. Fair , Sharon E. Oster
Posted Date:
Students also viewed these accounting questions
-
Wu Systems has the following balance sheet. Assume that all current assets are used in operations. How much net operating working capital does the firm have? Cash Accounts receivable $100 Accounts...
-
Traveller Bus Lines Inc. (TBL) is a wholly owned subsidiary of Canada Transport Enterprises Inc. (CTE). CTE is a publicly traded transportation and communications conglomerate. TBL is primarily in...
-
Question: Old MathJax webview Old MathJax webview i need ans of these question but the source is alot Old MathJax webviewOld MathJax webview i need ans of these question but the source is alot these...
-
In 2012, the average credit score for loans that were purchased through Fannie Mae was 766. A random sample of 35 mortgages were selected, and it was found that the average credit score was 771with a...
-
Explain how the concept of natural variability would enter into your conclusion about whether or not it could be concluded that the first route is faster, on average, than the second route.
-
Valentino is a patient in a nursing home for 45 days in 2017. While in the nursing home, he incurs total costs of $13,500. Medicare pays $8,000 of the costs. Valentino receives $15,000 from his...
-
Compare the PPP theory, the IFE theory, and the theory of interest rate parity (IRP), which was introduced in the previous chapter.
-
Consider the following program: Note that the scheduler in a uniprocessor system would implement pseudo parallel execution of these two concurrent processes by interleaving their instructions,...
-
Express 5.70x10-3 g in standard notation respecting significant figures. 0.0057 g 0.00570 g 5700 g 570 g
-
Wahroonga Homes Limited borrowed significantly in 2021 to develop apartments on several sites on the Pacific Highway in Turramurra, in Sydney's north. The recent quietening of the Sydney property...
-
What are some additional causes of labor cost-related challenges That could be within the restaurant managers control
-
Badger finds his spacecraft on the bottom of a hill, to quickly move his spacecraft up the hill and over the cliff, he ties a rope to himself and jumps over the cliff to pull the spacecraft, as shown...
-
What does "Engagement" mean to you? What types of community engagement have you been a part of? In your experience, what worked well? Why? What didn't work? How could that be changed?
-
Find the Dual of the following LP max z = 4x1 - x2 + 2x3 x1 + x2 5 2x1 + x2 7 2x2 + x3 26 x1 + x3 = 4 120, 22, 23 free (6) (10) (11)
-
Question2 In the table below you are given the details of the put options on the shares of Fica Limited Expiration Date September 2015 January 2016 Exercise Price (Rand) 430 430 Put Price (Premium)...
-
(Corporate income tax) The Robbins Corporation is an oil wholesaler. The firm's sales last year were $1.08 million, with the cost of goods sold equal to $630,000. The firm paid interest of $241,250...
-
Economic feasibility is an important guideline in designing cost accounting systems. Do you agree? Explain.
-
The hotel can only fund one of these three projects Cash flows/year 0 1 2 31 41 Total 1 2 3 -6,000 -3,000 -3,000 500 1,700 0 600 1,850 0 3,500 500 0 3,500 650 4,800 2,100 1,700 1,800 Note: these...
-
As the management accountant, the manager has asked you to explain the merits of the following capital investment appraisal techniques and make recommendations for a capital investment process to be...
-
What are the antecedents of the results and determinants model?
Study smarter with the SolutionInn App