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a. Prepare a cash receipts schedule for November and December. Prince Charles Island Company Cash Receipts Schedule Sales Credit sales Cash sales Collections in the month after credit sales Collections two months after credit sales Total cash receipts September $ October $ November $ $ December $ $ b. Prepare a cash budget with borrowing needed or repayments for November and December. (Do not leave any empty spaces; input a 0 wherever it is required. Amount to be deducted should be indicated with minus sign.)

a. Prepare a cash receipts schedule for November and December. Prince Charles Island Company Cash Receipts Schedule Sales Credit sales Cash sales Collections in the month after credit sales Collections two months after credit sales Total cash receipts September $ October $ November $ $ December $ $ b. Prepare a cash budget with borrowing needed or repayments for November and December. (Do not leave any empty spaces; input a 0 wherever it is required. Amount to be deducted should be indicated with minus sign.)

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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Prince Charles Island Company has expected sales of $6,000 in September, $10,000 in October, $16,000 in November, and $12,000 in December. Cash sales are 20 percent and credit sales are 80 percent of total sales. Historically, 40 percent of receivables are collected in the month after the sale, and the remaining 60 percent collected two months after. Assume that the company's cash payments for November are $13,000, and December $6,000. The beginning cash balance in November is $5,000, which is the desired minimum balance. a. Prepare a cash receipts schedule for November and December. Prince Charles Island Company Cash Receipts Schedule Sales Credit sales Cash sales Collections in the month after credit sales Collections two months after credit sales Total cash receipts Prince Charles Island Company Cash Budget Cash receipts Cash payments Net cash flow Beginning cash balance Cumulative cash balance Monthly loan or (repayment) Cumulative loan balance Ending cash balance. November $ September $ $ b. Prepare a cash budget with borrowing needed or repayments for November and December. (Do not leave any empty spaces; input a 0 wherever it is required. Amount to be deducted should be indicated with minus sign.) December $ October $ $ November $ $ December $ $
Transcribed Image Text:Prince Charles Island Company has expected sales of $6,000 in September, $10,000 in October, $16,000 in November, and $12,000 in December. Cash sales are 20 percent and credit sales are 80 percent of total sales. Historically, 40 percent of receivables are collected in the month after the sale, and the remaining 60 percent collected two months after. Assume that the company's cash payments for November are $13,000, and December $6,000. The beginning cash balance in November is $5,000, which is the desired minimum balance. a. Prepare a cash receipts schedule for November and December. Prince Charles Island Company Cash Receipts Schedule Sales Credit sales Cash sales Collections in the month after credit sales Collections two months after credit sales Total cash receipts Prince Charles Island Company Cash Budget Cash receipts Cash payments Net cash flow Beginning cash balance Cumulative cash balance Monthly loan or (repayment) Cumulative loan balance Ending cash balance. November $ September $ $ b. Prepare a cash budget with borrowing needed or repayments for November and December. (Do not leave any empty spaces; input a 0 wherever it is required. Amount to be deducted should be indicated with minus sign.) December $ October $ $ November $ $ December $ $
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