QUESTION 1Which of the following statements is false about cash budgets?O Cash receipts are calculated by adding up all the cash inflows in a given monthO When calculating the cash budget the firm must consider many aspects such as, cash receipts, cash expenses, minimum desired cash balance, andprevious loans.O Cash receipts include sales, investment income and interest expenses.All of the above are trueQUESTION 2Based on the data below calculate the company's combined cost?Annual requirements = 7500 unitsOrdering cost = BD 12Holding cost BD 0.5O125300450001500000

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Answered: QUESTION 1 Which of the following…

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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a. Beginning cash balance on June 1, P85,300. b. Cash receipts from sales, P519,500. Budgeted cash disbursements for purchases, P274,500. C. d. Budgeted cash disbursements for salaries, P96,300. e. Other budgeted cash expenses, P58,300. f. Cash repayment of bank loan, P33,300. g. Budgeted depreciation expense, P35,300. Use the above information to determine the ending cash balance to be reported on the month ended June 30 cash budget.
Cash Receipts Budget and Accounts Receivable Aging Schedule Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the following sales: Quarter 1 $4,760,000 Quarter 2 5,620,000 Quarter 3 3,060,000 Quarter 4 7,720,000 In Shalimar's experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are $5,310,000 and for the fourth quarter of the current year are $7,350,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. Quarter Cash Sales Credit Sales 3, current year 4, current year 1, next year 2, next year 3. next vear 4, next year 2. Construct a cash receipts budget for…
2. State whether the following sentences are TRUE or FALSE ASTARINS # Statements 1 The production budget is typically prepared prior to the sales budget. One benefit of budgeting is that it coordinates the activities of the entire organization. The master budget is a network consisting of many separate budgets that are interdependent. Sales forecasts are drawn up after the cash budget has been completed because only then are the funds available for marketing known. 5 A sales budget is a detailed schedule showing the expected sales for the budget period; typically, it is expressed in both dollars and units of product. 2 3 4 TRUE or FALSE 3. Which of the following represents the normal sequence in which the indicated budgets are prepared? A. Direct Materials, Cash, Sales B. Production, Cash, Income Statement C. Sales, Balance Sheet, Direct Labor D. Production, Manufacturing Overhead, Sales 1280 4. Which of the following represents the correct order in which the indicated budget documents…
How would you classify dividends from investments on a cash budget? a. Cash brought forward b. Payment c. Receipt d. Opening balance When comparing mutually exclusive alternatives that have different lives by the present worth method, it is necessary to: a. Always compare them over a time period of equal service b. Find the present worth over one life cycle of each alternative c. Always compare them over a period equal to the life of the shorter-lived alternative d. Always compare them over a period equal to the life of the longer-lived alternative
Kat Ltd.'s September balance sheet contains the following information: Cash Accounts receivable. Allowance for doubtful accounts Merchandise inventory $ 37,500 (dr) 126,000 (dr) 2,800 (cr) 26,250 (dr) Management has designated $37,500 as the firm's minimum monthly cash balance. Other information about the firm and its operations is as follows: a. Sales revenues of $350,000, $420,000, and $312,500 are expected for October, November, and December, respectively. All goods are sold on account. b. The collection pattern for accounts receivable is 60% in the month of sale, 39% in the month following the month of sale, and 1% uncollectible, which is set up as an allowance. c. Cost of goods sold is 60% of sales revenues. d. Management's target ending balance of merchandise inventory is 10% of the current month's budgeted cost of goods sold. e. All accounts payable for inventory are paid in the month of purchase. f. Other monthly expenses are $49,250, which includes $3,500 of depreciation and…
Bank loan officers would find which of the following budgets to be one of the most important in determining whether or not to give a company a loan? Sales budget O Production budget O Budgeted income statement O Budgeted balance sheet O Cash budget
which one is correct please confirm? QUESTION 16 When preparing a cash budget, once a firm has estimated its cash receipts the firm must ____________. a. pay dividends to its stockholders b. determine the desired cash balance c. plan a pro forma statement d. schedule disbursements
Which of the following can be used when forecasting cash flows?Select one:a. All of given choices.b. Inflows from customers.c. Outflows to suppliers.d. Outflows to employees.e. Accrual-based figures.
Which of the following statements is true? 1. Budgets are used for the distinct purposes of planning and profit. II. Control Involves developing goals and preparing various budgets to achieve those goals. III. A continuous or perpetual budget is a 12-month budget that rolls forward one month (or quarter) as the current month (or quarter) is completed. Multiple Choice None of the statements are true. Only statement Ill is true. ○ Only statement I is true. All of the statements are true. B
Cash management involves keeping an eye on the business's cash balance to ensure that A.the business is generating a profit B.all cash payments are included in the purchases budget C.there is enough cash on hand to pay for planned operations during the current period D.all cash receipts are included in the sales budget
Which of the following would appear on both the budgeted income statement and on the schedule of expected cash disbursements for operating expenses? (A) Depreciation expense (B) Rent expense (C) Sales commission expense (D) Both B and C
Weller Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow: • Sales are budgeted at $350,000 for November, $370,000 for December, and $360,000 for January. • Collections are expected to be 80% in the month of sale and 20% in the month following the sale. • The cost of goods sold is 69% of sales. • The company desires an ending merchandise inventory equal to 80% of the cost of goods sold in the following month. Payment for merchandise is made in the month following the purchase. • Other monthly expenses to be paid in cash are $20,100. Monthly depreciation is $19,900. Ignore taxes. Balance Sheet October 31 Assets Cash $ 20,900 81,900 Accounts receivable Merchandise inventory 193,200 Property, plant and equipment (net of $585,000 accumulated depreciation) 995,000 Total assets $1,291,000 Liabilities and Stockholders' Equity Accounts payable $ 194,900 500,000 596,100 Common stock Retained earnings Total…

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