Preparing a Short-Term Cash ForecastThe Lyon Corporation is a merchandising company. Prepare a short-term cash forecast for July of Year 6 following the format of Exhibit 9A.4. Selected financial data from Lyon Corporation as of July 1 of Year 6 are reproduced below ($ thousands):Additional Information:Gross profit equals 20% of cost of goods sold.Lyon purchases all inventory on the second day of the month and receives it the following week.Lyon pays 75% of payables within the month of purchase and the balance in the following month.Lyons pays all remaining expenses in cash. $ 20Cash, July 1, Year 6.Accounts receivable, July 1, Year 6.Forecasted sales for July..Forecasted accounts receivable, July 31, Year 6.Inventory, July 1, Year 6.Desired inventory, July 31, Year 6.Depreciation expense for July.Miscellaneous outlays for July..Minimum cash balance desired.20150212515....41130Accounts payable, July 1, Year 6.18...

working note: 1. purchase formula: closing inventory + cost of goods sold**- Beginning inventory =…

Answered: $ 20 Cash, July 1, Year 6. Accounts…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Preparing a Short-Term Cash Forecast

The Lyon Corporation is a merchandising company. Prepare a short-term cash forecast for July of Year 6 following the format of Exhibit 9A.4. Selected financial data from Lyon Corporation as of July 1 of Year 6 are reproduced below ($ thousands):

Additional Information:

Gross profit equals 20% of cost of goods sold.
Lyon purchases all inventory on the second day of the month and receives it the following week.
Lyon pays 75% of payables within the month of purchase and the balance in the following month.
Lyons pays all remaining expenses in cash.

$ 20
Cash, July 1, Year 6.
Accounts receivable, July 1, Year 6.
Forecasted sales for July..
Forecasted accounts receivable, July 31, Year 6.
Inventory, July 1, Year 6.
Desired inventory, July 31, Year 6.
Depreciation expense for July.
Miscellaneous outlays for July..
Minimum cash balance desired.
20
150
21
25
15
....
4
11
30
Accounts payable, July 1, Year 6.
18
...

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