Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has toborrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following informationhas been assembled to assist in preparing a cash budget for the quarter:a. Budgeted monthly absorption costing income statements for April-July are:SalesCost of goods soldGross marginSelling and administrative expenses:Selling expenseAdministrative expense*Total selling and administrative expensesNet operating income"Includes $28,000 of depreciation each month.AprilMayJuneJuly$ 600,000 $1,100,000 $ 560,000 $ 460,000420,000392,000322,000180,000168,000138,000770,000330,000111,000105,00064,80048,000159,000169,800 108, 600$ 21,000 $ 160,200 $ 59,400 $67,00041,60046,00044,00090,00048,000b. Sales are 20% for cash and 80% on account.c. Sales on account are collected over a three-month period with 10% collected in the month of sale; 70% collected in the first monthfollowing the month of sale; and the remaining 20% collected in the second month following the month of sale. February's salestotaled $260,000, and March's sales totaled $275,000.d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month ofpurchase. The remaining 50 % is paid in the following month. Accounts payable at March 31 for inventory purchases during Marchtotal $119,000.e. Each month's ending inventory must equal 20% of the cost of the merchandise to be sold in the following month. The merchandiseinventory at March 31 is $84,000.f. Dividends of $35,000 will be declared and paid in April.g. Land costing $43,000 will be purchased for cash in May.h. The cash balance at March 31 is $57,000; the company must maintain a cash balance of at least $40,000 at the end of each month.i. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning ofeach month, up to a total loan balance of $200,000. The interest rate on these loans is 1% per month and for simplicity we willassume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at theend of the quarterThe company's president is interested in knowing how reducing inventory levels and collecting accounts receivable sooner will impactthe cash budget. He revises the cash collection and ending inventory assumptions as follows:a. Sales continue to be 20% for cash and 80% on credit. However, credit sales from April, May, and June are collected over a three-month period with 25% collected in the month of sale, 65% collected in the month following sale, and 10% in the second monthfollowing sale. Credit sales from February and March are collected during the second quarter using the collection percentagesspecified in the main section.b. The company maintains its ending inventory levels for April, May, and June at 15% of the cost of merchandise to be sold in thefollowing month. The merchandise inventory at March 31 remains $84,000 and accounts payable for inventory purchases at March31 remains $119,000. Required:1. Using the president's new assumptions in (a) above, prepare a schedule of expected cash collections for April, May, and June and forthe quarter in total.2. Using the president's new assumptions in (b) above, prepare the following for merchandise inventory:a. A merchandise purchases budget for April, May, and June.b. A schedule of expected cash disbursements for merchandise purchases for April, May, and June and for the quarter in total.3. Using the president's new assumptions, prepare a cash budget for April, May, and June, andfor the quarter in total.Complete this question by entering your answers in the tabs below.Req 1Beginning cash balanceAdd collections from customersTotal cash availableLess cash disbursements:Purchases for inventorySelling expensesAdministrative expensesLand purchasesDividends paidReq 2AUsing the president's new assumptions, prepare a cash budget for April, May, and June, and for the quarter in total. (Cashdeficiency, repayments and interest should be indicated by a minus sign.)BorrowingsRepaymentInterestReq 2BTotal financingReq 3Total cash disbursementsExcess (deficiency) of cash available over disbursementsFinancing:Answer is not complete.Garden Sales, Inc.Cash BudgetFor the Quarter Ended June 30AprilS57,000 $403,800 X460,800344,750111,00020,000✔35,000 X510,750(49,950)90,000 X90.000May40,050 S774,000 X814,050582,400105,00036,80043,000 X767,20046,8500June46,850844,000890,850547,40067,00013,600628,000262,850(90,000) X(1,800) X(91 800)$Quarter57,000✔2,021,800 X2,078,8001,474,550283,000✔70,40035,000 X43,000 X1,905,950172,85090,000 X(90,000) X(1,800) X(1 800)www

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1. Using the president's new assumptions in (a) above, prepare a schedule of expected cash collections for April, May, and June and for the quarter in total. 2. Using the president's new assumptions in (b) above, prepare the following for merchandise inventory: a. A merchandise purchases budget for April, May, and June. b. A schedule of expected cash disbursements for merchandise purchases for April, May, and June and for the quarter in total. 3. Using the president's new assumptions prepare a cash budget for

1. Using the president's new assumptions in (a) above, prepare a schedule of expected cash collections for April, May, and June and for the quarter in total. 2. Using the president's new assumptions in (b) above, prepare the following for merchandise inventory: a. A merchandise purchases budget for April, May, and June. b. A schedule of expected cash disbursements for merchandise purchases for April, May, and June and for the quarter in total. 3. Using the president's new assumptions prepare a cash budget for

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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Capes Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow • Sales are budgeted at $470,000 for November, $480,000 for December, and $460,000 for January • Collections are expected to be 60% in the month of sale and 40% in the month following the sale The cost of goods sold is 70% of sales. • The compary desires an ending merchandise inventory equal to 40% of the cost of goods sold in the following month. Payment for merchandise is made in the month following the purchase. - The November beginning balance in the accounts receivable account is $82,000. The November beginning balance in the accounts payable account is $269,000. Required: a. Prepare a Schedule of Expected Cash Collections for November and December b. Prepare a Merchandise Purchases Budget for November and December. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a Schedule of Expected Cash Collections for November and December.…
Can someone help me with 2A, 2B, and 3 please?
The business needs to have a sense of its future cashflows and therefore requires the preparation of the following: 1. A schedule of budgeted cash collections for trade receivables for each of the months January to March. 2. A schedule of expected cash disbursements for accounts payable for each of the months January to March.
What are the estimated cash disbursements for inventories in April?
Carmen Company sells jar candles. The sales forecast (units) for the coming months is: April 210 May 140 June 150 July 200 August 160 Each candle costs $ 10. The ending inventory policy is 40% of next month's sales needs. April 1 inventory will be as expected under the policy. Carmen pays for purchases 30% in the month of purchase and 70% the following month. Accounts payable on April 1 is $2,460. Required: a. Prepare a purchases budget for the quarter ending June 30. Note: Deductible values must be indicated with a minus sign.a. Prepare a purchases budget for the quarter ending June 30. Note: Deductible values must be indicated with a minus sign. b. Prepare a cash payments budget for the quarter ending June 30.
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Assets Cash Minden Company Balance Sheet April 30 Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Note payable Common stock Retained earnings Total liabilities and stockholders' equity $ 11, 100 72,500 37,500 238,000 $ 359,100 $ 68,000 19,400 180,000 91,700 $ 359,100 The company is in the process of preparing a budget for May and assembled the following data: a. Sales are budgeted at $255,000 for May. Of these sales, $76,500 will be for cash; the remainder will be credit sales. One-half of a month's credit sales are collected in the month the sales are made, and the remainder are collected in the following month. All of the April 30 accounts receivable will be collected in May. b. Purchases of inventory are expected to total $189,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following…
What about preparing a schedule of expected cash disbursement for merchandise purchases, by month and the total and budgeted income statement for the three-month period ending June 30.
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expense Administrative expense* Total selling and administrative expenses Net operating income *Includes $28,000 of depreciation each month. April May June $ 600,000 $1,100,000 $ 560,000 420,000 770,000 392,000 180,000 330,000 168,000 111,000 48,000 159,000 105,000 46,000 64,800 44,000 169,800 108,600 90,000 $ 21,000 $ 160,200 $ 59,400 $ 48,000 July $460,000 322,000 138,000 67,000 41,600 b. Sales are 20% for cash and 80% on account. c. Sales on account are collected over a three-month period with 10%…
From the above information, can you produce the budgeted statement of financial position and a brief analysis report?
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LB Enterprises (LB) is preparing its budget for the first quarter of 2019. LB's balance sheet as of December 31, 2018 is as follows: Assets Liabilities Cash $5,000 Accounts Payable $9500 Accounts Recievable 28,000 Inventories Direct Materials 8,100 Finished Goods (500 Units) 16,870 Stockholders Equity Equipment - gross 45,000 Accumulated depreciation 15.000 Common Stock $15,000 Net Equipment 30,000 Retained Earnings 63,470 Total Assets $87,970 Total Liabilities and $87,960 Equity LB sells one product for $45/unit. The Company forecasts that it will sell 2,000; 1,500; 1,600; and 1,700 units in January, February, March and April, respectively. • Sales to customers are all on credit. 40% of the cash for these sales is collected in the month of the sale and the remaining 60% is collected in the following month. LB wants finished goods inventory equal to 25% of the next month's sales on hand at the end of each month. LB wants direct materials equal to 75% of the current month's production…