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Here are some important figures from the budget of Crenshaw, Inc., for the second quarter of 2019: Credit sales Credit purchases Cash disbursements April $412,000 189,000 May $361,000 177,000 June $449,000 210,000 Wages, taxes, and 80,700 76,200 104,900 expenses Interest 10.400 38,000 10,400 10,500 10,400 157,000 Equipment purchases The company predicts that 5 percent of its credit sales will never be collected, 25 percent of its sales will be collected in the month of the sale, and the remaining 70 percent will be collected in the following month. Credit purchases will be paid in the month following the purchase. In March 2019, credit sales were $339,000.

Here are some important figures from the budget of Crenshaw, Inc., for the second quarter of 2019: Credit sales Credit purchases Cash disbursements April $412,000 189,000 May $361,000 177,000 June $449,000 210,000 Wages, taxes, and 80,700 76,200 104,900 expenses Interest 10.400 38,000 10,400 10,500 10,400 157,000 Equipment purchases The company predicts that 5 percent of its credit sales will never be collected, 25 percent of its sales will be collected in the month of the sale, and the remaining 70 percent will be collected in the following month. Credit purchases will be paid in the month following the purchase. In March 2019, credit sales were $339,000.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Saved Here are some important figures from the budget of Crenshaw, Inc., for the second quarter of 2019: April $412,000 189,000 May $361,000 177,000 June $449,000 210,000 Credit sales Credit purchases Cash disbursements Wages, taxes, and 80,700 76,200 104,900 expenses Interest 10.400 38,000 10,400 10,500 10.400 157,000 Equipment purchases The company predicts that 5 percent of its credit sales will never be collected, 25 percent of its sales will be collected in the month of the sale, and the remaining 70 percent will be collected in the following month. Credit purchases will be paid in the month following the purchase. In March 2019, credit sales were $339,000. Using this information, complete the following cash budget. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.) April May June Beginning cash balance 119,000 Cash receipts Cash collections from credit sales Total cash available Cash disbursements Purchases 181,000 Wages, taxes, and expenses Interest Equipment purchases Total cash disbursements Ending cash balance < Prev 4 of 4 e here to search
Transcribed Image Text:Saved Here are some important figures from the budget of Crenshaw, Inc., for the second quarter of 2019: April $412,000 189,000 May $361,000 177,000 June $449,000 210,000 Credit sales Credit purchases Cash disbursements Wages, taxes, and 80,700 76,200 104,900 expenses Interest 10.400 38,000 10,400 10,500 10.400 157,000 Equipment purchases The company predicts that 5 percent of its credit sales will never be collected, 25 percent of its sales will be collected in the month of the sale, and the remaining 70 percent will be collected in the following month. Credit purchases will be paid in the month following the purchase. In March 2019, credit sales were $339,000. Using this information, complete the following cash budget. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.) April May June Beginning cash balance 119,000 Cash receipts Cash collections from credit sales Total cash available Cash disbursements Purchases 181,000 Wages, taxes, and expenses Interest Equipment purchases Total cash disbursements Ending cash balance < Prev 4 of 4 e here to search
Expert Solution
Step 1

First we need to calculate cash collection from credit sales.

Particulars March April  May June
Credit Sales 339000 412000 361000 449000
25% in the mont of sales 84750 103000 90250 112250
70% in the following month   237300 288400 252700
Total   340300 378650 364750
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