Assets Cash 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 $ 18,700 70,250 41,250 230,000 $ 360,200 $ 72,250 13,700 180,000 94,250 $ 360,200 The company is in the process of preparing a budget for May and assembled the following data: a. Sales are budgeted at $214,000 for May. Of these sales, $64,200 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 $122,000 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 month. All of the April 30 accounts payable to suppliers will be paid during May. c. The May 31 inventory balance is budgeted at $47,500. d. Selling and administrative expenses for May are budgeted at $85,500, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $2,050 for the month. e. The note payable on the April 30 balance sheet will be paid during May, with $390 in interest. (All of the interest relates to May.) f. New refrigerating equipment costing $16,300 will be purchased for cash during May. g. During May, the company will borrow $24,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year. Required: For May: 1. Calculate the expected cash collections from customers. 2. Calculate the expected cash disbursements for merchandise purchases. 3. Prepare a cash budget. 4. Prepare a budgeted income statement. 5. Prepare an end-of-month budgeted balance sheet. Naut eck m
Assets Cash 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 $ 18,700 70,250 41,250 230,000 $ 360,200 $ 72,250 13,700 180,000 94,250 $ 360,200 The company is in the process of preparing a budget for May and assembled the following data: a. Sales are budgeted at $214,000 for May. Of these sales, $64,200 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 $122,000 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 month. All of the April 30 accounts payable to suppliers will be paid during May. c. The May 31 inventory balance is budgeted at $47,500. d. Selling and administrative expenses for May are budgeted at $85,500, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $2,050 for the month. e. The note payable on the April 30 balance sheet will be paid during May, with $390 in interest. (All of the interest relates to May.) f. New refrigerating equipment costing $16,300 will be purchased for cash during May. g. During May, the company will borrow $24,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year. Required: For May: 1. Calculate the expected cash collections from customers. 2. Calculate the expected cash disbursements for merchandise purchases. 3. Prepare a cash budget. 4. Prepare a budgeted income statement. 5. Prepare an end-of-month budgeted balance sheet. Naut eck m
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working
Transcribed Image Text:Assets
Cash
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
$ 18,700
70,250
41,250
230,000
$ 360,200
$ 72,250
13,700
180,000
94,250
$ 360,200
The company is in the process of preparing a budget for May and assembled the following data:
a. Sales are budgeted at $214,000 for May. Of these sales, $64,200 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 $122,000 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 month. All of the April 30 accounts payable
to suppliers will be paid during May.
c. The May 31 inventory balance is budgeted at $47,500.
d. Selling and administrative expenses for May are budgeted at $85,500, exclusive of depreciation. These expenses will be paid in
cash. Depreciation is budgeted at $2,050 for the month.
e. The note payable on the April 30 balance sheet will be paid during May, with $390 in interest. (All of the interest relates to May.)
f. New refrigerating equipment costing $16,300 will be purchased for cash during May.
g. During May, the company will borrow $24,500 from its bank by giving a new note payable to the bank for that amount. The new
note will be due in one year.
Required:
For May:
1. Calculate the expected cash collections from customers.
2. Calculate the expected cash disbursements for merchandise purchases.
3. Prepare a cash budget.
4. Prepare a budgeted income statement.
5. Prepare an end-of-month budgeted balance sheet.
Naut
eck m
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