A B You will prepare a static master budget, budgeted financial statements and a flexible budget/variance analysis for Karry No Key, Inc. which will sell karaoke machines. Assumptions: You plan to form Karry No Key on April 1 and expect the following: 1. Invest in exchange for stock 2. Purchase delivery truck with cash with $0 salvage value and expected useful life in years 100,000 60,000 10 3. Sales increase per month 2% Collections in month of sale 69% Collections of remainder in following month of sale 4. Desired ending inventory (% of next month's expected sales) Payments in month of purchase Payments of remainder in following month of purchase 5. Other operating expenses per month to be paid in month incurred 31% 20% 10% 90% 49,000 Requirement 1: Complete the Sales Budget and Cash Collections for April - June and the quarter in total using applicable assumptions above. Sales Budget April May June Total 1st Quarter April Sales in units 1960 Price per unit 98.00 $ 98.00 $ 98.00 $ 98.00 Total sales dollars n/a Cash Collections April sales May sales April May June Total 1st Quarter April n/a n/a n/a n/a June sales Total cash collected Accounts receivable at month end n/a Requirment 2: Complete the Purchase Budget for April - June and the quarter in total using the applicable assumptions above. Purchases Budget April May June Total 1st Quarter April Sales in units n/a n/a Desired ending inventory Total required Beginning inventory Total units to purchase n/a n/a n/a Cost per unit $4 59.00 $ 59.00 $ 59.00 $ 59.00 Purchases in dollars n/a
A B You will prepare a static master budget, budgeted financial statements and a flexible budget/variance analysis for Karry No Key, Inc. which will sell karaoke machines. Assumptions: You plan to form Karry No Key on April 1 and expect the following: 1. Invest in exchange for stock 2. Purchase delivery truck with cash with $0 salvage value and expected useful life in years 100,000 60,000 10 3. Sales increase per month 2% Collections in month of sale 69% Collections of remainder in following month of sale 4. Desired ending inventory (% of next month's expected sales) Payments in month of purchase Payments of remainder in following month of purchase 5. Other operating expenses per month to be paid in month incurred 31% 20% 10% 90% 49,000 Requirement 1: Complete the Sales Budget and Cash Collections for April - June and the quarter in total using applicable assumptions above. Sales Budget April May June Total 1st Quarter April Sales in units 1960 Price per unit 98.00 $ 98.00 $ 98.00 $ 98.00 Total sales dollars n/a Cash Collections April sales May sales April May June Total 1st Quarter April n/a n/a n/a n/a June sales Total cash collected Accounts receivable at month end n/a Requirment 2: Complete the Purchase Budget for April - June and the quarter in total using the applicable assumptions above. Purchases Budget April May June Total 1st Quarter April Sales in units n/a n/a Desired ending inventory Total required Beginning inventory Total units to purchase n/a n/a n/a Cost per unit $4 59.00 $ 59.00 $ 59.00 $ 59.00 Purchases in dollars n/a
Chapter6: Managing Cash Flow
Section: Chapter Questions
Problem 1EP
Related questions
Concept explainers
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.
Question
Transcribed Image Text:A v A v
$ - %
9
00
00 20,
Paste
B
IUv
A Cell Styles v
D3
fx Yes
G
B
30 Requirment 2: Complete the Purchase Budget for April - June and the quarter in total using the applicable assumptions above.
April
n/a
n/a
n/a
Purchases Budget
April
May
June
Total 1st Quarter
May
31
32
Sales in units
n/a
n/=
n/
Desired ending inventory
Total required
Beginning inventory
Total units to purchase.
33
34
n/
n/a
n/
35
36
n/a
n/
59.00 | $
59.00 | $
59.00 $
59.00
Cost per unit
Purchases in dollars
37
38
n/a
n/
39
Cash Payments
April
May
June
Total 1st Quarter
April
Ma
40
41
Inventory purchases:
n/a
n/a
n/a
n/a
n/a
n/a
42
April purchases
n
43
May purchases
n
44
June purchases
Total cash paid for inventory
Cash paid for other operating expenses
n.
45
n
46
n
47
Accounts Payable at month end
n.
48
49 Requirement 3: Using the information from above, prepare Karry No Key's quarterly budgeted financial statements.
50
Ce
Assets
Liabilities
Shareholder's Equity
Ass
51
Amount Account
Amount Account
Amount Account
Am
52
Issued stock
n
53
Purchase equipment
54
55
Inventory purchases
56
57
Sales
58
nA
59
Other operating expenses
61 Depreciation
60
62
63
Karry No Key, Inc.
Budgeted Contribution Margin Income Statement
64
Cell links/formulas:
65
For the Quarter Ended June 30, 20X1
Instructions
A M7 Project
+
Ready
Transcribed Image Text:B
D.
You will prepare a static master budget, budgeted financial statements and a flexible budget/variance analysis for Karry No Key, Inc. which will sell karaoke machines.
5 Assumptions: You plan to form Karry No Key on April 1 and expect the following:
6 1. Invest in exchange for stock
2. Purchase delivery truck with cash
with $0 salvage value and expected useful life in years
9 3. Sales increase per month
100,000
60,000
8
10
2%
Collections in month of sale
69%
Collections of remainder in following month of sale
2 4. Desired ending inventory (% of next month's expected sales)
Payments in month of purchase
Payments of remainder in following month of purchase
5 5. Other operating expenses per month to be paid in month incurred
1
31%
20%
3
10%
4
90%
49,000
Requirement 1: Complete the Sales Budget and Cash Collections for April - June and the quarter in total using applicable assumptions above.
Sales Budget
April
May
June
Total 1st Quarter
April
Sales in units
1960
Price per unit
$
98.00
98.00
98.00
98.00
Total sales dollars
n/a
Cash Collections
April
n/a
n/a
n/a
April
May
June
Total 1st Quarter
April sales
May sales
June sales
Total cash collected
n/a
Accounts receivable at month end
n/a
Requirment 2: Complete the Purchase Budget for April - June and the quarter in total using the applicable assumptions above.
Purchases Budget
April
May
June
Total 1st Quarter
April
Sales in units
n/a
Desired ending inventory
Total required
Beginning inventory
Total units to purchase
n/a
n/a
n/a
n/a
Cost per unit
59.00
59.00 | $
59.00
59.00
Purchases in dollars
n/a
Instructions
A M7 Project
Ready
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