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1 Calculate the expected total cash collections for July 2 Calculate the expected cash disbursements for merchandise purchases for July Final Answer Box Students are required to provide the support calculations for answers in the boxes below. For example 10,000+20,000+30,000 = 60,000

1 Calculate the expected total cash collections for July 2 Calculate the expected cash disbursements for merchandise purchases for July Final Answer Box Students are required to provide the support calculations for answers in the boxes below. For example 10,000+20,000+30,000 = 60,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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I need help with starting the calculations for the following two questions.

Valley Manufacturing is worth 35 points & P & B Manufacturing is worth 30 points for a total of 65 points Cash Accounts receivable Inventory Valley Manufacturing Inc Balance Sheet June 30, 2021 Assets Plant and equipment, net of depreciation Total Assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total Liabilities and Stockholders' Equity Valley's managers have made the following additional assumptions and estimates: 1 Estimated sales for July and August are $360,000 and $315,000 respectively $ $ $ $ $ $ $ $ $ 140,000 175,000 45,200 554,800 915,000 115,000 586,000 214,000 915,000 2 Each month's sales are 20% cash sales and 80% credit sales. Each month's credit sales are collected 30% in the month of the sale and 70% in the month following the sale. All of the accounts receivable at June 30 will be collected in July 3 Each month's ending inventory must equal 20% of the cost of the next month's sales. The Cost of Goods Sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the acc nts payable at June 30 will be paid i July 4 Monthly selling and administrative expenses are always $75,000. Each month $10,000 of this total amount is depreciation expense and the remaining $65,000 relates to expenses that are paid in the month they are incurred 5 The company does not plan to buy or sell any plant and equipment during July. It will not borrow any money, pay any dividends, issue any common stock or repurchase any of its own common stock during July
Transcribed Image Text:Valley Manufacturing is worth 35 points & P & B Manufacturing is worth 30 points for a total of 65 points Cash Accounts receivable Inventory Valley Manufacturing Inc Balance Sheet June 30, 2021 Assets Plant and equipment, net of depreciation Total Assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total Liabilities and Stockholders' Equity Valley's managers have made the following additional assumptions and estimates: 1 Estimated sales for July and August are $360,000 and $315,000 respectively $ $ $ $ $ $ $ $ $ 140,000 175,000 45,200 554,800 915,000 115,000 586,000 214,000 915,000 2 Each month's sales are 20% cash sales and 80% credit sales. Each month's credit sales are collected 30% in the month of the sale and 70% in the month following the sale. All of the accounts receivable at June 30 will be collected in July 3 Each month's ending inventory must equal 20% of the cost of the next month's sales. The Cost of Goods Sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the acc nts payable at June 30 will be paid i July 4 Monthly selling and administrative expenses are always $75,000. Each month $10,000 of this total amount is depreciation expense and the remaining $65,000 relates to expenses that are paid in the month they are incurred 5 The company does not plan to buy or sell any plant and equipment during July. It will not borrow any money, pay any dividends, issue any common stock or repurchase any of its own common stock during July
1 Calculate the expected total cash collections for July 2 Calculate the expected cash disbursements for merchandise purchases for July Final Answer Box Students are required to provide the support calculations for answers in the boxes below. For example 10,000 + 20,000 + 30,000 = 60,000
Transcribed Image Text:1 Calculate the expected total cash collections for July 2 Calculate the expected cash disbursements for merchandise purchases for July Final Answer Box Students are required to provide the support calculations for answers in the boxes below. For example 10,000 + 20,000 + 30,000 = 60,000
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