Capes Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow. • Sales are budgeted at $220,000 for November, $230,000 for December, and $210,000 for January. . Collections are expected to be 55% in the month of sale and 45% in the month following the sale. • The cost of goods sold is 70% of sales. • The company desires an ending merchandise inventory equal to 35% of the cost of goods sold in the following month. Payment for merchandise is made in the month following the purchase. • The November beginning balance in the accounts receivable account is $57,000. • The November beginning balance in the accounts payable account is $244,000. Required: a. Prepare a Schedule of Expected Cash Collections for November and December. b. Prepare a Merchandise Purchases Budget for November and December. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a Schedule of Expected Cash Collections for November and December. Sales Schedule of Expected Cash Collections Accounts receivable November sales December sales Total cash collections November $ $ $ December 220,000 $ 230,000 121,000 570,000 $ 126,500 99,000 691,000 $ 225,500 ne
Capes Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow. • Sales are budgeted at $220,000 for November, $230,000 for December, and $210,000 for January. . Collections are expected to be 55% in the month of sale and 45% in the month following the sale. • The cost of goods sold is 70% of sales. • The company desires an ending merchandise inventory equal to 35% of the cost of goods sold in the following month. Payment for merchandise is made in the month following the purchase. • The November beginning balance in the accounts receivable account is $57,000. • The November beginning balance in the accounts payable account is $244,000. Required: a. Prepare a Schedule of Expected Cash Collections for November and December. b. Prepare a Merchandise Purchases Budget for November and December. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a Schedule of Expected Cash Collections for November and December. Sales Schedule of Expected Cash Collections Accounts receivable November sales December sales Total cash collections November $ $ $ December 220,000 $ 230,000 121,000 570,000 $ 126,500 99,000 691,000 $ 225,500 ne
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
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Transcribed Image Text:Capes Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow:
• Sales are budgeted at $220,000 for November, $230,000 for December, and $210,000 for January.
. Collections are expected to be 55% in the month of sale and 45% in the month following the sale.
• The cost of goods sold is 70% of sales.
• The company desires an ending merchandise inventory equal to 35% of the cost of goods sold in the following month. Payment
for merchandise is made in the month following the purchase.
• The November beginning balance in the accounts receivable account is $57,000.
• The November beginning balance in the accounts payable account is $244,000.
Required:
a. Prepare a Schedule of Expected Cash Collections for November and December.
b. Prepare a Merchandise Purchases Budget for November and December.
Complete this question by entering your answers in the tabs below.
Required A Required B
Prepare a Schedule of Expected Cash Collections for November and December.
Sales
Schedule of Expected Cash Collections
Accounts receivable
November sales
December sales
Total cash collections
November
$
$
$
December
220,000 $ 230,000
121,000
570,000 $
7
691,000 $
< Required A
126,500
99,000
225,500
Required B >
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