On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the company's sales are made on account. The following information has been provided by Spicer's management. Month Credit Sales $ 300,000 (actual) 400,000 (actual) 625,000 (estimated) 876,000 (estimated) 800,000 (estimated) January February March April May The company's collection activity on credit sales historically has been as follows. Collections in the month of the sale Collections one month after the sale Collections two months after the sale Uncollectible accounts 50% 30 15 Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400,000 per month). Its- cash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarter. Compute Spicer's budgeted cash balance at the ends of March. April, and May Cash balance on March 31 Cash balance on April 30 Cash balance on May 31

On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the company's sales are made on account. The following information has been provided by Spicer's management. Month Credit Sales $ 300,000 (actual) 400,000 (actual) 625,000 (estimated) 876,000 (estimated) 800,000 (estimated) January February March April May The company's collection activity on credit sales historically has been as follows. Collections in the month of the sale Collections one month after the sale Collections two months after the sale Uncollectible accounts 50% 30 15 Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400,000 per month). Its- cash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarter. Compute Spicer's budgeted cash balance at the ends of March. April, and May Cash balance on March 31 Cash balance on April 30 Cash balance on May 31

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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Prepare a master budget for the three-month period ending June 30 that includes a schedule of expected cash collections, by month and in total.
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sh On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the company's sales are made on account. The following infor- mation has been provided by Spicer's management. Month January February March April May Credit Sales Collections in the month of the sale Collections one month after the sale Collections two months after the sale Uncollectible accounts ary. The company's collection activity on credit sales historically has been as follows. $300,000 (actual) 400,000 (actual) 600,000 (estimated) 700,000 (estimated) 800,000 (estimated) 50% 30 15 5 Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400,000 per month). Its cash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarter. Compute Spicer's budgeted cash balance at the ends of March, April, and May.
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