Cash Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Note payable Common stock Retained earnings $ 18,500 58,500 40,750 202,000 $ 319,750 $ 67,750 15,800 180,000 56,200 Total liabilities and stockholders' equity $ 319,750 The company is in the process of preparing a budget for May and has assembled the following data: a. Sales are budgeted at $263,000 for May. Of these sales, $78,900 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 is 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 $193,000 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 $63,000. d. Selling and administrative expenses for May are budgeted at $73,200, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $4,650 for the month. e. The note payable on the April 30 balance sheet will be paid during May, with $210 in interest. (All of the interest relates to May.) f. New refrigerating equipment costing $11,900 will be purchased for cash during May. g. During May, the company will borrow $27,200 from its bank by giving a new note navable to the bank for that amount The new note will be due in one year

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money

Section: Chapter Questions

Problem 9.9E

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Can you please help me make a cash budget for May, a budgeted income statement for May, and a budgeted balance sheet as May 31.

Cash
Accounts receivable
Inventory
Buildings and equipment, net of depreciation
Total assets
Liabilities and Stockholders' Equity
Accounts payable
Note payable
Common stock
Retained earnings
$ 18,500
58,500
40,750
202,000
$ 319,750
$ 67,750
15,800
180,000
56,200
Total liabilities and stockholders' equity
$ 319,750
The company is in the process of preparing a budget for May and has assembled the
following data:
a. Sales are budgeted at $263,000 for May. Of these sales, $78,900 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 is 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 $193,000 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 $63,000.
d. Selling and administrative expenses for May are budgeted at $73,200, exclusive of
depreciation. These expenses will be paid in cash. Depreciation is budgeted at $4,650
for the month.
e. The note payable on the April 30 balance sheet will be paid during May, with $210 in
interest. (All of the interest relates to May.)
f. New refrigerating equipment costing $11,900 will be purchased for cash during May.
g. During May, the company will borrow $27,200 from its bank by giving a new note
navable to the bank for that amount The new note will be due in one year

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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