Franklin Company, which expects to start operations on January 1, year 2, will sell digital cameras in shopping malls. Franklin has budgeted sales as indicated in the following table. The company expects a 11 percent increase in sales per month for February and March. The ratio of cash sales to sales on account will remain stable from January through March. Required a. Complete the sales budget by filling in the missing amounts. b. Determine the amount of sales revenue Franklin will report on its first quarter pro forma income statement. Complete this question by entering your answers in the tabs below. Required A Required B Complete the sales budget by filling in the missing amounts. (Do not round intermediate calculations. Round final answers to two decimal places.) Sales Cash sales Sales on account Total budgeted sales January $ $ 35,000 101,000 136,000 February March

Franklin Company, which expects to start operations on January 1, year 2, will sell digital cameras in shopping malls. Franklin has budgeted sales as indicated in the following table. The company expects a 11 percent increase in sales per month for February and March. The ratio of cash sales to sales on account will remain stable from January through March. Required a. Complete the sales budget by filling in the missing amounts. b. Determine the amount of sales revenue Franklin will report on its first quarter pro forma income statement. Complete this question by entering your answers in the tabs below. Required A Required B Complete the sales budget by filling in the missing amounts. (Do not round intermediate calculations. Round final answers to two decimal places.) Sales Cash sales Sales on account Total budgeted sales January $ $ 35,000 101,000 136,000 February March

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has…

A: To prepare Garden Depot's cash budget, we need to calculate the total cash available, total cash…

Q: Pat's Mediterranean Restaurant is preparing its budgeted balance sheet for the coming year. The cash…

A: Cash Budget is prepared to analysis the cash transaction or cash flow of business.Non-cash items…

Q: Jordan Company, which expects to start operations on January 1, year 2, will sell digital cameras in…

A: A budget is an estimation of expected revenue and expenses on the basis of previous experience. It…

Q: Given the following information, construct the firm’s cash budget for the given months and answer…

A: Part 2: Explanation:Step 1: Calculate total cash receipts for each month. In February, there's an…

Q: Vernon Company, which expects to start operations on January 1, year 2, will sell digital cameras in…

A: The credit sales are the sales for which cash is not received yet. The accrual basis accounting…

Q: The Game Zone sells computer and other electronic games. The store has budgeted sales for January…

A: Requirement A To calculate the sales budget for February and March, we'll use the given increase…

Q: Franklin Company, which expects to start operations on January 1, year 2, will sell digital cameras…

A: The sales budget is referred to a financial forecast that outlines the expected sales revenues for a…

Q: Adams Company is a retail company that specializes in selling outdoor camping equipment. The company…

A: Statement of Cash Flow -A statement of Cash Flow is a financial statement that includes the inflow…

Q: Morgan Inc. is preparing its cash budget. The company’s policy states that its minimum required cash…

A: The objective of the question is to calculate the estimated cash balance after financing at the end…

Q: To attain its desired ending cash balance for December, the company needs to borrow:

A: Cash Budget is prepared by the Business Entity to provide for the budgeted expenses and revenues.…

Q: DGT Incorporated is preparing its cash budget for April. The budgeted beginning cash balance is…

A: Formula: Borrowings = Desired Ending Cash balance - Excess (deficiency) of cash available over…

Q: Use this information about Nuthatch Corporation to answer the question that follows. Nuthatch…

A: In the case in question, we are given that:30% of every month's sales is cashBalance 70% is credit…

Q: Please prepare a cash budget for the Maliwan Co. for the month of April based on the following…

A: A cash budget is an estimate of a corporation's cash flows for a given time span. A cash budget is…

Q: Sally Company specializes in office chairs. The company is in the process of preparing detailed…

A: The budget is prepared to estimate the number of units to be produced during the period and number…

Q: CC expects sales for January, February, and March to be $420,000, $480,000, and $500,000,…

A: Budget means the expected value of future. Budget is not affected by the actual value as it is…

Q: ty Company expects sales for the first three months of next year to be $205,000, $240,000 and…

A: Schedule of cash collection includes collection of sales based on their % of collection in…

Q: ONas Corporation is preparing its cash budget for September. The budgeted beginning cash balance is…

A: Cash budget is one of the important budget that is being prepared in business in order to show…

Q: N3R Care Company, a distributor of herb-based sunscreens, is ready to begin its fourth quarter in…

A: Cash budget is the budget prepared by the company forecasting future possible cash to be received…

Q: With the following information about Quantum Plastics Ltd., prepare a cash budget for the months of…

A: Cash budget is the statement which is prepared by the entity for the purpose of estimating the…

Q: Determine the account receivable balances at March 31, 2022.

A: Clients usually pay 60% of their fee in the month that service is provided, 30% the month after, and…

Q: ABC Company’s budgeted sales for June, July, and August are 13,200, 17,200, and 15,200 units…

A: The objective of the question is to prepare an analysis of cash receipts from sales for ABC Company…

Q: Big City Manufacturing (BCM) is preparing its cash budget and expects to have sales of $450,000 in…

A: cash receipt in March from January sales = January sales x 35% cash receipt in March from February…

Q: The marketing department of Jessi Corporation has submitted the following sales forecast for the…

A: The budget is prepared to estimate the requirements for the future period. The production budget is…

Q: Adams Company is a retail company that specializes in selling outdoor camping equipment. The company…

A: Budgeting -Budgeting is the process of estimating future operations based on past performance. % are…

Q: For the month of April, the total cash receipts from sales and collections on account would be

A: Cash budget is prepared by a business entity to anticipate the expected cash requirements for the…

Q: ggfftyy

A: Let's complete the sales budget step-by-step:Determine the ratio of cash sales to sales on account…

Concept explainers

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.

Question

Franklin Company, which expects to start operations on January 1, year 2, will sell digital cameras in shopping malls. Franklin has
budgeted sales as indicated in the following table. The company expects a 11 percent increase in sales per month for February and
March. The ratio of cash sales to sales on account will remain stable from January through March.
Required
a. Complete the sales budget by filling in the missing amounts.
b. Determine the amount of sales revenue Franklin will report on its first quarter pro forma income statement.
Complete this question by entering your answers in the tabs below.
Required A Required B
Complete the sales budget by filling in the missing amounts. (Do not round intermediate calculations. Round final answers to
two decimal places.)
Sales
Cash sales
Sales on account
Total budgeted sales
January
$
35,000
101,000
$ 136,000
February
March

Determine the amount of sales revenue Franklin will report on its first quarter pro forma income statement. (Do not round
intermediate calculations. Round final answers to two decimal places.)
Sales revenue

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

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…
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…
I Rooney Company, which expects to start operations on January 1, year 2, will sell digital cameras in shopping malls. Rooney has budgeted sales as indicated in the following table. The company expects a 15 percent increase in sales per month for February and March. The ratio of cash sales to sales on account will remain stable from January through March Required a. Complete the sales budget by filling in the missing amounts. b. Determine the amount of sales revenue Rooney will report on its first quarter pro forma income statement. Complete this question by entering your answers in the tabs below. Required Required B Complete the sales budget by filling in the missing amounts. (Do not round intermediate calculations. Round final answers to two decimal places.) March Sales Cash sales Sales on account Total budgeted sales January February $45,000 115,000 160,000
Bright Minds Toy Company prepared the following sales budget for the second quarter. Projected sales for each of the first three months of operations are as follows: Sales Budget Cash Sales April 130,000 470,000 Sales on Account 600,000 Multiple Choice Bright Minds expects to collect 70% of the sales on account in the month of sale, 20% in the month following the sale, and the remainder in the second month following the sale. What is the ending accounts receivable balance that would be reported on the pro forma balance sheet prepared as of June 30? O O O $202,700 $149,500 $344.000 May 83,000 512,000 595,000 $106,400 June 155,000 505,000 660,000
B. Mahmoud Repair Company is preparing its budget for the first quarter of 2021. The next step in the budgeting process is to prepare a cash receipts schedule and a cash payments schedule. To that end the following information has been collected. Clients usually pay 60% of their fee in the month that service is provided, 30% the month after, and 10% the second month after receiving service. Actual service revenue for 2016 and expected service revenues for 2021 are: November 2020, $120,000; December 2020, $110,000; January 2021, $140,000; February 2021, $160,000; March 2021, $170,000. Purchases on landscaping supplies (direct materials) are paid 40% in the month of purchase and 60% the following month. Actual purchases for 2020 and expected purchases for 2021 are: December 2020, $21,000; January 2021, $20,000; February 2021, $22,000; March 2021, $27,000. Instructions (a) Prepare the following schedules for each month in the first quarter of 2021 and for the quarter in total: (1)…
A company's sales for the nine months to 30 September are $2.5m. The sales forecast for the next three months is $500,000 in total. The company's budgeted sales for the year are $3.4m The company's CEO has a meeting with the sales manager to discuss plans to close the gap between the forecast and the original budgeted sales for the next quarter. What is this process an example of? Feedback control An activity-based budget A rolling budget Feed-forward control
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
Munoz Company is a retail company that specializes in selling outdoor camping equipment. The company is considering opening a new store on October 1, year 1. The company president formed a planning committee to prepare a master budget for the first three months of operation. As budget coordinator, you have been assigned the following tasks. Required a. October sales are estimated to be $340,000, of which 40 percent will be cash and 60 percent will be credit. The company expects sales to increase at the rate of 20 percent per month. Prepare a sales budget. b. The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month following the sale. Prepare a schedule of cash receipts. c. The cost of goods sold is 70 percent of sales. The company desires to maintain a minimum ending inventory equal to 20 percent of the next month's cost of goods sold. However, ending inventory of December is expected to be $12,900. Assume that all purchases are made…
A company is preparing its cash budget for the upcoming quarter. The company's sales are expected to be $500,000 in January, $600,000 in February, and $700,000 in March. The company's cost of goods sold is 60% of sales. The company's beginning cash balance is $50,000, and the company desires to maintain a minimum cash balance of $25,000. How much financing does the company need in February? $25,000 $60,000 $0 $35,000
Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements 1st Quarter $ 210,000 $ 281,000 The company's beginning cash balance for the upcoming fiscal year will be $26,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded. Beginning cash balance Total cash receipts Total cash available Total cash disbursements Excess (deficiency) of cash available over disbursements Financing: Borrowings Repayments Interest Required: Prepare the company's cash budget for the upcoming fiscal year.…
Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $42,000 and $74,000, respectively. The company expects to collect 35% of its credit sales in the month of the sale and the remaining 65% in the following month. What amount of cash collections from credit sales would the company include in its cash budget for the second month?