Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th Is shown below: Beech Corporation Balance Sheet June 30 Assets $ 72,000 128,000 60,900 218,000 $ 478,900 Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable $ 79,000 Common stock 308,000 91,900 $ 478,900 Retained earnings Total liabilities and stockholders' equity Exercise 8-12 (Algo) Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $290,000, $310,000, $300,000, and $320,000, respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% In the month of sale and 65% in the month following the sale. All of the accounts recelvable at June 30 will be collected in July. 3. Each month's ending Inventory must equal 30% of the cost of next month's sales. The cost of goods sold is 70% of sales. The company pays for 40% of Its merchandise purchases in the month of the purchase and the remalning 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $54,000. Each month $5,000 of this total amount is depreclation expense and the remaining $49,000 relates to expenses that are pald in the month they are incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to Issue any common stock or repurchase its own stock during the quarter ended September 30.

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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I just need the requirement #4 to be answered which is the balance sheet

Also, explain me how to make the calculations

### Required Information

**Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet**
[LO8-2, LO8-4, LO8-9, LO8-10]

*[The following information applies to the questions displayed below.]*

Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below:

#### Beech Corporation
**Balance Sheet**
*June 30*

- **Assets**
- Cash: $72,000
- Accounts receivable: $128,000
- Inventory: $68,900
- Plant and equipment, net of depreciation: $218,000
- **Total assets:** $478,900

- **Liabilities and Stockholders’ Equity**
- Accounts payable: $79,000
- Common stock: $308,000
- Retained earnings: $91,900
- **Total liabilities and stockholders’ equity:** $478,900

### Exercise 8-12 (Algo)

Beech’s managers have made the following additional assumptions and estimates:

1. Estimated sales for July, August, September, and October will be $290,000, $310,000, $300,000, and $320,000, respectively.
2. All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July.
3. Each month’s ending inventory must equal 30% of the cost of next month’s sales. The cost of goods sold is 70% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July.
4. Monthly selling and administrative expenses are always $54,000. Each month $5,000 of this total amount is depreciation expense and the remaining $49,000 relates to expenses that are paid in the month they are incurred.
5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or

### Financial Statement Preparation Guide

#### Requirements:

1. **Prepare a Schedule of Expected Cash Collections**:
- For the months of July, August, and September.

2. **Merchandise Purchases Budget**:
- **2-a**. Prepare a budget for purchasing merchandise for July, August, and September.
- Compute the total merchandise purchases for the quarter ending September 30.
- **2-b**. Prepare a schedule for expected cash disbursements for merchandise purchases for these months.

3. **Prepare an Income Statement**:
- Calculate net operating income for the quarter ending September 30.

4. **Prepare a Balance Sheet**:
- As of September 30.

#### Instructions:

- Enter your responses in the provided tabs as indicated below.

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### Balance Sheet Example

**Beech Corporation**
**Balance Sheet**
**September 30**

#### Assets

- [Blank Entry Field]
- [Blank Entry Field]
- [Blank Entry Field]
- Total Assets: $0

#### Liabilities and Stockholders' Equity

- [Blank Entry Field]
- [Blank Entry Field]
- [Blank Entry Field]
- Total Liabilities and Stockholders' Equity: $0

### Navigation

- Use the navigation buttons to move between requirements (e.g., Req 3, Req 4).

This structured approach helps ensure that each financial requirement is systematically addressed, aiding in complete and accurate financial reporting.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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