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 January $ 300,000 (actual) February March April May 400,000 (actual) 559,000 (estimated) 556,000 (estimated) 800,000 (estimated) 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 Cash balance on March 31 Cash balance on April 30 Cash balance on May 31 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

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 January $ 300,000 (actual) February March April May 400,000 (actual) 559,000 (estimated) 556,000 (estimated) 800,000 (estimated) 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 Cash balance on March 31 Cash balance on April 30 Cash balance on May 31 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

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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he following table lists data from the budget of Ritewell Publishers. Half the company’s sales are for cash on the nail; the other half are paid for with a one-month delay. The company pays all its credit purchases with a one-month delay. Credit purchases in January were $47, and total sales in January were $214. Assume all expenses, other than purchases, are cash transactions. February March April Total sales $234 $254 $214 Purchases of materials For cash 87 97 77 For credit 57 47 57 Other expenses 47 47 47 Taxes, interest, and dividends 27 27 27 Capital investment 30 0 0 Complete the cash budget in the following table.
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.
Emerald Service anticipates the following sales revenue over a five-month period Its collection history indicates that credit sales are collected as follows E (Click the icon to view the sales data ) The company's sales are 40% cash and 60% credit O (Click the icon to view the collections data) How much cash will be collected in January? In February? In March? For the quarter in total? Complete the cash budget to determine how much cash will be collected in January, February, March and for the quarter in total. (Round your answers to the nearest whole dollar) Emerald Service Cash Collections Budget For the Months of January through March January Cash sales 6,080 Collection of credit sales 25% Month of sale 2,280 50% Month after 15% Two months after Total cash collections
On October 1 of the current year, Molloy Corporation prepared a cash budget for October, November, and December. All of Molloy's sales are made on account. The following information was used in preparing estimated cash collections: August sales (actual) September sales (actual) October sales (estimated) November sales (estimated) December sales (estimated) $ 40,000 $ 50,000 $ 20,000 $ 70,000 $ 60,000 Approximately 60% of all sales are collected in the month of the sale, 30% is collected in the following month, and 10% is collected in the month thereafter. Budgeted collections from customers in October total:
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Use the following information to prepare the September cash budget for PTO Company. Ignore the “Loan activity” section of the budget. Beginning cash balance, September 1, $47,000. Budgeted cash receipts from September sales, $262,000. Direct materials are purchased on credit. Purchase amounts are August (actual), $77,000; and September (budgeted), $103,000. Payments for direct materials follow: 60% in the month of purchase and 40% in the first month after purchase. Budgeted cash payments for direct labor in September, $35,000. Budgeted depreciation expense for September, $3,400. Budgeted cash payment for dividends in September, $57,000. Budgeted cash payment for income taxes in September, $10,900. Budgeted cash payment for loan interest in September, $1,100.
You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company's operations: a. The cash balance on December 1 is $56,600. b. Actual sales for October and November and expected sales for December are as follows: Cash sales Sales on account October $ 71,200 $ 440,000 November $ 73,400 December $ 86,200 $ 576,000 $ 639,000 Sales on account are collected over a three-month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible. c. Purchases of inventory will total $315,000 for December. Thirty percent of a month's inventory purchases are paid during the month of purchase. The accounts payable remaining from November's inventory purchases total $181,500, all of which will be paid in December. d. Selling and administrative expenses are budgeted at $522,000…
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. January February March Month Credit Sales $300,000 (actual) 400,000 (actual) 473,000 (estimated) April May 671,000 (estimated) 800,000 (estimated) 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 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. Answer is complete but not entirely…
Nestee controller for Mactan Relaters has assembled the following data to assist in the preparation of a cash budget for the third quarter of 2021: Sales- May $100,000 ;June $120,000; July $90,000 ; August $100,000 September $135,000; October $110,000 Each month, 30% of sales are for cash and 70% ore on credit. The collection pattern for credit sales is 20% in the month of sale, 50% in the following month, and 30% in the second month following the sale. Each month the ending inventory exactly equals 50% of the cost of next month's sales. The markup on goods is 25% of cost. Inventory purchases are paid in the month following the purchase. Monthly expenses are as follows: Salaries and wages $10,000; Depreciation $4,000; Utlites $1,000; Other $1,700. Property taxes of $15,000 are due and payable on July 15,2021. Advertising fees of $6,000 must be paid on August 20,2021. A lease on a new storage facility is scheduled to begin on September 2, 2021.Monthly payments are $5,000. The…
Papst Company is preparing its cash budget for the month of May. The following information is available concerning its accounts receivable (based on sales made to customers on open account): Actual credit sales for March Actual credit sales for April Estimated credit sales for May Estimated collections in the month of sale Estimated collections in the first month after the month of sale Estimated collections in the second month after the month of sale Estimated provision for bad debts (made in the month of sale) $225,000 $ 293,000 $ 438,000 25% 60% 10% 5% The firm writes off all uncollectible accounts at the end of the second month after the month of sale. Required: Determine for Papst Company for the month of May: 1. The estimated cash receipts from accounts receivable collections. 2. The gross amount of accounts receivable at the end of the month (after appropriate write-off of uncollectible accounts). 3. The net amount of accounts receivable at the end of the month. 4. Recalculate…