Fill the boxes Consider the following financial information and budgeted projections for Globe Inn. 1.) Projected sales

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Consider the following financial information and budgeted projections for Globe Inn. 1.) Projected sales revenue and related collections information: November 2020. December 2020 January 2021 February 2021 March 2021 $ 30,000 $ 45,000 $ 50,000 $ 88,000 $ 67,000 Historically, 35% of all monthly sales are cash sales. For sales that are not collected immediately, 45% of monthly sales are collected in the month following the sale (after 30 days), and 20% of monthly sales are collected in the second month after the sale (after 60 days). 2.) Total monthly merchandise purchase costs average 40% of total sales revenue for that month. According to management policy, 40% of these monthly purchases are cash purchases and therefore paid in the same month as the purchase. The remaining 60% of the monthly purchases were credit purchases on account and are paid in the month following the purchase (after 30 days). 3.) Employee wages are paid in cash at the end of each month, and on average total wages paid is equal to 15% of total sales revenue for that month. Interest on mortgage [see (a)] Depreciation Property taxes [see (b)] Insurance [see (c)] Other expenses [see (d)] 4.) Other budgeted expenses are as follows: December January February March $ 1,520 $1,500 $ 1,495 $ 1,490 2,000 2,000 2,000 500 500 500 500 2,000 2,000 2,000 500 500 500 500 2,000 2,000 Additional information relating to these budgeted expenses is as follows: (a) The interest presented above represents a portion of Globe Inn's $2,000 total monthly cash mortgage payment, the remaining portion represents a the payment to reduce the loan principle. (b) The budgeted property taxes expense represents the allocated 'accounting' expense portion of the total annual cost that is reported equally to each month. However, the municipality requires that property taxes be paid in $3,000 installments twice per year, once in January, once in July. (c) The budgeted insurance expense represents the allocated 'accounting' expense portion of the total annual premium that is reported equally to each month covered by the policy. However, the insurance premiums are paid in installments of $1000 every other month beginning in December. (d) Other expenses are paid each month as the expense is incurred. Consider the following financial information and budgeted projections for Globe Inn. 1.) Projected sales revenue and related collections information: November 2020. December 2020 January 2021 February 2021 March 2021 $ 30,000 $ 45,000 $ 50,000 $ 88,000 $ 67,000 Historically, 35% of all monthly sales are cash sales. For sales that are not collected immediately, 45% of monthly sales are collected in the month following the sale (after 30 days), and 20% of monthly sales are collected in the second month after the sale (after 60 days). 2.) Total monthly merchandise purchase costs average 40% of total sales revenue for that month. According to management policy, 40% of these monthly purchases are cash purchases and therefore paid in the same month as the purchase. The remaining 60% of the monthly purchases were credit purchases on account and are paid in the month following the purchase (after 30 days). 3.) Employee wages are paid in cash at the end of each month, and on average total wages paid is equal to 15% of total sales revenue for that month. Interest on mortgage [see (a)] Depreciation Property taxes [see (b)] Insurance [see (c)] Other expenses [see (d)] 4.) Other budgeted expenses are as follows: December January February March $ 1,520 $1,500 $ 1,495 $ 1,490 2,000 2,000 2,000 500 500 500 500 2,000 2,000 2,000 500 500 500 500 2,000 2,000 Additional information relating to these budgeted expenses is as follows: (a) The interest presented above represents a portion of Globe Inn's $2,000 total monthly cash mortgage payment, the remaining portion represents a the payment to reduce the loan principle. (b) The budgeted property taxes expense represents the allocated 'accounting' expense portion of the total annual cost that is reported equally to each month. However, the municipality requires that property taxes be paid in $3,000 installments twice per year, once in January, once in July. (c) The budgeted insurance expense represents the allocated 'accounting' expense portion of the total annual premium that is reported equally to each month covered by the policy. However, the insurance premiums are paid in installments of $1000 every other month beginning in December. (d) Other expenses are paid each month as the expense is incurred.

Answer rating: 100% (QA)

Depreciation is not a cash expense G Property ... View the full answer