30, the end of the company's fiscal year. of Peter Pan Ltd, at June Peter Pan Ltd Trial Balance as at June 30, 2018 A/C Name DR $ 440,000 530,000 CR $ Cash Accounts Receivable Allowance for Bad Debts Merchandise Ihventory Store Supplies Prepaid Rent Fumiture and Equipment Accumulated Depreciation -Furniture and Equipment Accounts Payable Wages Payable Notes Payable, Long-Term Unearned Sales Revenue Peter Pantry, Capital Peter Pantry, Withdrawal Sales Revenue Earmed Cost of Goods Sold Wages Expense Rent Expense Utilities Expense Depreciation Expense-Furniture and Equipment Store Supplies Expense Bad debt Expense Interest Expense 40,000 320,000 10,000 280,000 600,000 120,000 145,000 510,000 260,000 1,900,000 75,000 1,095,000 645,000 525,000 210,000 230,000 160,000 45,000 4,070,000 Total 4,070,000
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Task: You are employed to Peter Pan Ltd a company owned by Peter Pantry, a merchandiser involved in the business of selling baking utensils and equipment. On January 1st, 2018 you were appointed to the position of Chief Financial Officer which made you responsible for the maintenance of the company’s accounting records, internal control and preparation of the financial statements. The following
The following additional information is available at June 30, 2018:
(i) Eight (8) months’ rent amounting to $280,000 was PAID IN ADVANCE on January 1, 2018
(ii) The Furniture and equipment is being depreciated over 10 years on the double-declining balance method of depreciation, down to a residue of $80,000.
(iii) Wages earned by employees NOT yet paid amounted to $35,000 at June 30, 2018.
(iv) A physical count of inventory at June 30, 2018, reveals $290,000 worth of inventory on hand.
(v) On January 1, 2018 the company received $260,000 IN ADVANCE for sales to be provided evenly from January 1, 2018, through October 31, 2018. None of the revenue from this client has been recorded.
(vi) The aging of the Accounts Receivable schedule at June 30, 2018 indicated that the Allowance for
Required:
a) Prepare the necessary
b) Prepare the company’s multiple-step income statement for the year ended June 30, 2018.
c) Prepare the company’s statement of owner’s equity for the year ended June 30, 2018.
d) Prepare the company’s classified balance sheet as at June 30, 2018.
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