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1. Prepare a schedule of cash receipts for the months of July, August, and September.

1. Prepare a schedule of cash receipts for the months of July, August, and September.

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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Required information [The following information applies to the questions displayed below. Built-Tight is preparing its master budget. Budgeted sales and cash payments follow. Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead Sales Cash receipts from July $ 57,500 Total cash receipts 15,860 3,740 19,900 Sales to customers are 20% cash and 80% on credit. Sales in June were $55,000. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $41,000 in cash and $4,700 in loans payable. A minimum cash balance of $41,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $41,000. Interest is 1% per month based on the beginning of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $41,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,700 per month), and rent ($6,200 per month). BUILT-TIGHT Schedule of Cash Receipts from Sales July $ August $ 73,500 1. Prepare a schedule of cash receipts for the months of July, August, and September. 13,140 3,060 16,500 0 $ September $ 54,500 August September $ 57,500 $ 73,500 $ 54,500 0$ 13,460 3,140 16,900 0
Transcribed Image Text:Required information [The following information applies to the questions displayed below. Built-Tight is preparing its master budget. Budgeted sales and cash payments follow. Budgeted sales Budgeted cash payments for Direct materials Direct labor Overhead Sales Cash receipts from July $ 57,500 Total cash receipts 15,860 3,740 19,900 Sales to customers are 20% cash and 80% on credit. Sales in June were $55,000. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $41,000 in cash and $4,700 in loans payable. A minimum cash balance of $41,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $41,000. Interest is 1% per month based on the beginning of-the-month loan balance and is paid at each month-end. Any preliminary cash balance above $41,000 is used to repay loans at month-end. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,700 per month), and rent ($6,200 per month). BUILT-TIGHT Schedule of Cash Receipts from Sales July $ August $ 73,500 1. Prepare a schedule of cash receipts for the months of July, August, and September. 13,140 3,060 16,500 0 $ September $ 54,500 August September $ 57,500 $ 73,500 $ 54,500 0$ 13,460 3,140 16,900 0
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