creat a balence sheet Assume all 12 months have 30 days to make the calculations easier. This is commonly done in the business world. a. Beginning cash balance on January 1, 20xx is projected to be $25,000. This money was raised through issuing common stock and should be recorded accordingly. b. All Sales are on account. Sales are as follows: January: $1,406,095; February: $1,645,258; and March: $1,884,420. c. Customers paid in cash each month as follows: Utilities bills are as follows: January, $478,072; February, $1,037,460; and March, $1,481,309. d. Direct material packets costing $145 each are purchased on the first day of January and payable immediately, $327,600. e. Direct material packets costing $144 each are purchased on account as follows: January (due in February), $251,641; February, $313,445; and March, $350,280. Direct materials are payable in the month after the purchase. f. Direct Labor (production employee wages) are paid as follows: January, $252,588; February, $228,300; and March, $260,100. Wages earned by employees during the first half of each month are paid on the third Friday of the current month. Wages earned in the second half of the month are paid on the first Friday of the next month. Assume that the workforce is stable each month (hence, wages and salaries are the same every day of the month). Hint: You will need to use three accounts on one line. Inventory should be one of your accounts. g. Manufacturing overhead: Rent each month is $64,410. Rent for each month is due on the first day of each month. h. Manufacturing overhead: Insurance is paid monthly at a cost of $23,617. i. Manufacturing overhead: All utilities are on account and are payable in the month after use. Utilities bills are as follows: January, $42,940; February, $38,811; and March, $44,217. j. Manufacturing overhead: Production and quality control management salaries are paid once a month in the month after earned the wage. Wages earned are as follows: January, $68,704; February, $62,098; and March, $70,747. k. Manufacturing equipment costing $1,030,000 was purchased with a interest free loan from RLA Equipment. Hint: This will only be purchased in January. l. The interest free manufacturing equipment loan is for ten years and will be paid monthly. m. Manufacturing overhead: The salvage value of the equipment purchased in K is $10,000. The estimated use life is 5 years. Straight line depreciation is used. n. Cost of Goods Sold (COGS) each month is as follows: January, $571,100; February, $668,941; and March, $765,931. o. Variable SG&A Expense: Sales commissions are payable in the month after the sale. Sales commissions each month is as follows: January, $196,853; February, $230,336; and March, $263,819. p. Variable SG&A Expense: Bad debt is calculated at 0.12 of sales. q. Fixed SG&A Expense: Administrative salaries and fringe benefits are $60,000 per month. Administrative salaries are paid one-half on the third Friday of the current month and one-half is on the first Friday of the next month. r. Fixed SG&A Expense: Rent on administrative office space is $10,500 per month. Rent for each month is due on the first day of each month. s. On January 1, 20xx the Company will pay an $84,000 annual administrative insurance liability premium for the covering January through December, 20xx. This insurance policy is a different policy than MOH insurance. t. Fixed SG&A Expense: Make the appropriate adjusting entries for January's insurance expense. u. Variable SG&A Expense: Other administrative expenses (utilities, office supplies, etc) are paid in the month after the expense occurs. Other administrative expenses are as follows: January, $105,457; February, $123,394; and March, $141,332. v. The company has a $750,000 line of credit (notes payable). Borrowing and repayments occurred as follows: January, $175,000; February, $25,000; and March, ($200,000). Hint: If a number is in ($$$), money was paid back on the line of credit. w. The federal and state income tax rate is estimated at 25%. Taxes accrue on each month’s income and will be paid quarterly on April 15, July 15, etc. Hint: Your company is successful, and YOU WILL NEED TO PAY TAXES. If you are running at a loss, you have done something wrong.