Deacon Company Balance Sheet March 31 Assets Cash Accounts receivable Inventory Buildings and equipment, net of...
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Deacon Company Balance Sheet March 31 Assets Cash Accounts receivable Inventory Buildings and equipment, net of depreciation $ 68,800 34, 000 64, 600 122,000 $ 289,400 Total assets Liabilities and Stockholders Equity Accounts payable Connon stock Retained earnings $ 96, 500 70, 000 122,900 $ 289,400 Total liabilities and stockholders' equity Budgeted Incone Statements April $ 182,000 109, 200 72,800 18, 800 $ 54,000 May $ 192,000 115, 200 76,800 20, 300 $ 56,500 June $ 212,000 127, 200 84, 800 23, 300 $ 61,500 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating incone Budgeting Assumptions: a. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remalning 80% are collected in the month subsequent to the sale. b. Budgeted sales for July are $222,000. c. 10% of merchandise Inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are pald in the month subsequent to the purchase. The accounts payable at March 31 will be paid in April. d. Each month's ending merchandise inventory should equal $10,000 plus 50% of the next month's cost of goods sold. e. Depreclation expense is $1,300 per month. All other selling and administrative expenses are pald in full in the month the expense is Incurred. Required: 1. Calculate the expected cash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30th. (Hint: You need to calculate the cash pald for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30th balance sheet.) Deacon Company Balance Sheet March 31 Assets Cash Accounts receivable Inventory Buildings and equipment, net of depreciation $ 68,800 34, 000 64, 600 122,000 $ 289,400 Total assets Liabilities and Stockholders Equity Accounts payable Connon stock Retained earnings $ 96, 500 70, 000 122,900 $ 289,400 Total liabilities and stockholders' equity Budgeted Incone Statements April $ 182,000 109, 200 72,800 18, 800 $ 54,000 May $ 192,000 115, 200 76,800 20, 300 $ 56,500 June $ 212,000 127, 200 84, 800 23, 300 $ 61,500 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating incone Budgeting Assumptions: a. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remalning 80% are collected in the month subsequent to the sale. b. Budgeted sales for July are $222,000. c. 10% of merchandise Inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are pald in the month subsequent to the purchase. The accounts payable at March 31 will be paid in April. d. Each month's ending merchandise inventory should equal $10,000 plus 50% of the next month's cost of goods sold. e. Depreclation expense is $1,300 per month. All other selling and administrative expenses are pald in full in the month the expense is Incurred. Required: 1. Calculate the expected cash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30th. (Hint: You need to calculate the cash pald for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30th balance sheet.)
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1 Budgeted cash collections for April May June Budgeted cash collection Apr May June Credit sales 40 ... View the full answer
Related Book For
Financial accounting
ISBN: 978-0132751124
9th edition
Authors: Walter T. Harrison Jr., Charles T. Horngren, C. William Thom
Posted Date:
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