Brady, Inc. is in the process of budgeting cash inflows for the next three months. Cash sales are 10 percent of total sales each month. Historically, sales on account have bee collected as follows: 70 percent in the month of sale, 25 percent in the month after th sale, and the remaining 5 percent two months after the sale. Sales for the next three months are projected as follows: April, $192,000; May, $210,000; and June, $220,000 Accounts receivable on March 31 was $54,000.

Brady, Inc. is in the process of budgeting cash inflows for the next three months. Cash sales are 10 percent of total sales each month. Historically, sales on account have bee collected as follows: 70 percent in the month of sale, 25 percent in the month after th sale, and the remaining 5 percent two months after the sale. Sales for the next three months are projected as follows: April, $192,000; May, $210,000; and June, $220,000 Accounts receivable on March 31 was $54,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Orange Company has sales of $50,000 in March and $60,000 in April. Forecast sales for May, June, and July are $70,000, $80,000, and $100,000, respectively. The firm has a cash balance of $5,000 on 1 May and wishes to maintain a minimum cash balance of $5,000. Given the following data, prepare and interpret a cash budget for the months of May, June, and July. • The firm makes 20% of sales for cash, 60% are collected in the next month, and the remaining 20% are collected in the second month following sale • The firm recelves other income of $2,000 per month • The firm's actual or expected purchases, all made for cash, are $50,000, $70,000, and $80,000 for the months of May through July, respectively • Rent is $3,000 per month • Wages and salaries are 10% of the previous month's sales • Cash dividends of $3,000 will be paid in June • Payment of principal and interest of $4,000 is due in June • A cash purchase of equipment costing $6,000 is scheduled in July • Taxes of $6,000 are due in…
McFarland Company makes 70 percent of its sales in cash. Credit sales are collected as follows: 70 percent in the month of sale and 30 percent in the month following the sale. McFarland's budgeted sales for upcoming months follow: $ 24,200 42,000 40,000 38,000 June July August September Required: Compute McFarland's expected cash receipts for August Budgeted Cash Receipts
Given the following information, complete the cash budget: Collections occur one month after the sale. January’s credit sales were $90,000. The firm has a certificate of deposit for $50,000 that matures in April. Salaries are $150,000 a month. The monthly mortgage payment is $20,000. Monthly depreciation is $10,000. Property tax of $35,000 is due in February. Round your answers to the nearest dollar. Enter the disbursements values as positive values. Use a minus sign to enter shortage of cash, negative beginning and ending cash values, if any. Do not leave any cells blank. If the answer is zero, enter "0". February March April Sales $ 170,000 $ 200,000 $ 230,000 Cash sales $ 35,000 $ 20,000 $ 70,000 Collections $ $ $ Other receipts $ $ $ Total cash receipts $ $ $ Salaries $ $ $ Mortgage $ $ $ Other disbursements $ $ $ Total cash disbursements $ $ $ Net…
The Model Company is to begin operations in April. It has budgeted April sales of $70,000, May sales of $74,000, June sales of $80,000, July sales of $82,000, and August sales of $78,000. Note that 10% of each month's sales is expected to represent cash sales; 75% of the balance is expected to be collected in the month following the sale, 17% the second month, 6% the third month, and the balance is expected to be uncollectible. What is the amount of cash to be collected in the month of July?
Mitchell Company had the following budgeted sales for the first half of next year: The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Assume that the accounts recelvable balance on January 1 was $76,000. Of this amount, $60,000 represented uncollected December sales and $16,000 represented uncollected November sales. Glven these data, the total cash collected during January would be: Multiple Choice $138.000 $100,000 $196,000 $197,000
Laurey Inc. is working on its cash budget for June. The budgeted beginning cash balance is $45,100. Budgeted cash receipts total $129,000, and budgeted cash disbursements total $134,000. The desired ending cash balance is $60,000. To attain its desired ending cash balance for June, the company needs to borrow:
Company L charges all operating expenses to credit. They pay 70% of their accounts payable in the month following the expense, and 30% two months following the expense. Expenses (all paid for on credit) for the last three months have been provided below: August: $80,000 September: $120,000 October: $94,000 What is the budgeted cash outflow for October?
Nuthatch Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business September, October, and November are $239,000, $319,000, and $424,000, respectively. The company expects to sell 30% of its merchandise for cash. Of sales on account, 80% are expected to be collected in the month of the sale and 20% in the month following the sale. The cash collections expected in November from accounts receivable are projected to be: Ca. $338,520 Ob. $282,100 Oc. $237,440 Od. $192,780
Martinez Company has budgeted sales revenue as follows for the next 4 months: February March April May March sales Past experience indicates that 70% of sales each month are on credit. The remainder are cash sales. Collection of credit sales occurs as follows: 60% in the month of sale, 35% in the month following the sale, and 3% in the second month following the sale. The other 2% is uncollectible. Credit sales Prepare a schedule which shows expected cash receipts from sales for the month of May. April sales MARTINEZCOMPANY Expected Cash Receipts from Sales For the Month Ended May 31 Credit sales $310,000 May sales 245,000 Credit sales 230,000 Cash sales 330,000 Total cash receipts OOONO
Tucker Inc. had the following budgeted sales for the first half of the current year: Cash Sales Credit SalesJanuary $70,000 $340,000February 50,000 190,000March 40,000 135,000April 35,000 120,000May 45,000 160,000June 40,000 140,000The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on credit sales: 60% in month of sale 30% in month following sale 10% in second month following sale There is no beginning accounts receivable balance. The total cash collected by Tucker Inc. during January would be: The total cash collected by Tucker Inc. during February would be: The total cash collected by Tucker Inc. during March would be: The total cash collected by Tucker Inc. during April would be: The total cash collected by Tucker Inc. during May would…
Develop a cash budget for the next three months using the information provided below. Monthly sales forecasts are $150,000, $180,000, and $60,000 (June, July, August) The current month's sales are $120,000 (May) Cost of goods sold equals 65% of sales Lease payment= 22,000 per month The company is required to pay an installment of $120,000 for a note (debt) The cash position at the end of the current month is $80,000 The target cash balance is $50,000 Assume that 60% of sales are collected in the month sold and the remaining collected in the following month.
Getty Company expects sales for the first three months of next year to be $185,000, $235,000 and $310,000, respectively. Getty expects 30 percent of its sales to be cash and the remainder to be credit sales. The credit sales will be collected as follows: 10 percent in the month of the sale and 90 percent in the following month. Compute a schedule of Getty's cash receipts for the months of February and March. February March Budgeted cash receipts $ 250,000