Question 9View PoliciesCurrent Attempt in ProgressThe following information was taken from Waterway Industries's cash budget for the month of July:Beginning cash$450000balance364000Cash receipts494000Cash disbursementsIf the company has a policy of maintaining a minimum end of the month cash balance of $390000, the amount thecompany would have to borrow isO $320000.O $60000.O $26000.$70000.hp340fholinsprt sc44deletehome&7numbackspacelockP7HKLenterpauseΣZ

Cash budget shows the expected cash inflows and cash outflows for a budgeted period. Cash budget…

Answered: Question 9 View Policies Current…

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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Question 9 The Hothi Company prepares monthly cash budgets. Relevant data from operating budgets for 2023 are as follows: January February Sales $ 350,000 $ 400,000 Direct materials purchases 120,000 110,000 Selling and administrative expenses 220,000 267,000 Cash balances: The Hothi Company expects its cash balance on January 1, 2023, to be $50,000. It wants to maintain a cash balance of $40,000 by using its line of credit (ignore calculation and repayments of interest). Cash receipts: All sales are on account. The company expects collections to be 50% in the month of sale, 40% in the first month following the sale, and 10% in the second month following the sale. Credit sales: November 2022, $200,000; December 2022, $280,000 Cash disbursements: It pays 30% of direct materials purchases in cash in the month of…
Question 20 /1 View Policies Current Attempt in Progress Vaughn Manufacturing budgets on an annual basis for its fiscal year. The following beginning and ending inventory levels are planned for the fiscal year of July 1, 2016 to June 30, 2017: port June 30, 2017 June 30, 2016 Raw Materials 2000 kilos 1000 kilos Three kilos of raw materials are needed to produce each unit of finished product. If Vaughn Manufacturing plans to produce 580000 units during the 2016-2017 fiscal year, how many kilos of materials will the company need to purchase for its production during the year? O 1741000 O 1740000 O 1739000 O 1744000 8:54 PM 11/27/2019 hp ort sc delete end pg NA 44 & 5 6 backspace Onu fock P home K enter esned shit ci I O
Exercise 20-17 (Algo) Preparation of cash budgets (for three periods) LO P2 Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. January February March Cash Receipts Cash payments $527,000 407,500 472,000 $473,800 354,300 532,000 Kayak requires a minimum cash balance of $40,000 at each month-end. Loans taken to meet this requirement charge 1%, interest per month, paid at each month-end. The interest is computed based on the beginning balance of the loan for the month. Any preliminary cash balance above $40,000 is used to repay loans at month-end. The company has a cash balance of $40,000 and a loan balance of $80,000 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.). KAYAK COMPANY Beginning cash…
QUESTION 3 REQUIRED Use the information provided below to prepare the following for Mustang Enterprises for January and February 2024. 3.1 Debtors Collection Schedule 3.2 Cash Budget. INFORMATION The following information was supplied by Mustang Enterprises: 1. Mustang Enterprises expects to have an unfavourable bank balance of R40 000 on 31 December 2023. 2. The monthly sales were projected as follows: 2023 Units November 44 000 December 53 000 2024 Units January 47 000 February 31 000 3. The selling price is R20 per unit (excluding any discounts). All the goods produced each month are expected to be sold in the same month. Sixty percent (60%) of the sales is expected to be on credit and the balance is for cash. Thirty percent (30%) of the cash sales is subject to a discount of 10%. 4. Credit sales are usually collected as follows: 20% in the month of sale, and these debtors receive a 5% discount. 75% in the month after the sale, and the rest is usually written off as bad debts. 5.…
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Exercise 2 (Schedule of Expected Cash Collections) Peak sales for General Products, Inc. occur in September. The company's sales budget for the third quarter showing these peak sales is given below, July Budgeted sales... P885,500 August P1,018,000 PI,222,000 P3,125,500 September Total From past experience, the company has learned that 20% of a month's sales are collected in the month of sale, that another 70% is collected in the month following sale, and that the remaining 10% is collected in the second month following sale. Bad debts are negligible and can be ignored. May sales totaled P700,000 and June sales totaled P770,000. Required: 1. Prepare a schedule of expected cash collections from sales, by month and in total, for the third quarter. 2. Assume that the company will prepare a budgeted balance sheet of September 30. Compute the accounts receivable as of the date.
KAYAK COMPANYCash Budget JanuaryFebruaryMarchBeginning cash balance$30,000 $30,000 Add: Cash receipts525,000 400,000 450,000 Total cash available555,000 430,000 Less: Cash payments for All items excluding interest Interest on loan Total cash payments0 0 0 Preliminary cash balance Additional loan (loan repayment) Ending cash balance Loan balanceLoan balance - Beginning of month Additional loan (loan repayment) Loan balance, end of month$0 $0 $0
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Paul's Pool Service provides pool cleaning, chemical application, and pool repairs for residential customers. Clients are billed weekly for services provided and usually pay 40 percent of their fees in the month the service is provided, In the month following service, Paul collects 50 percent of service fees. The final 10 percent is collected in the second month following service. Paul purchases his supplies on credit, and pays 50 percent in the month of purchase and the remaining 50 percent in the month following purchase. Of the supplies Paul purchases, 85 percent is used in the month of purchase, and the remainder is used in the month following purchase. The following information is available for the months of June, July, and August, which are Paul's busiest months: • June 1 cash balance $14,800. • June 1 supplies on hand $4,000. • June 1 accounts receivable $8,300. • June 1 accounts payable $3,900. · Estimated sales for June, July, and August are $24,900, $37,400, and $39,900,…
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Cash Budget Brindle Arts had the following Cash Budget for Quarter 1, 2022. The company requires a minimum cash balance of $ 50,000 Fill in the missing values: **If a cell has a value of 0, type the 0. A blank cell will be marked as incorrect. January February March Quarter 1 Beginning Cash balance $ 50,000 $ 166,756 $ 50,000 Add cash collections Total cash available $ 662,638 $ 673,643 $ 812,693 $ 1,931,075 Less total cash disbursements: Purchases $ 185,078 $ 189,439 Direct labor $ 86,875 $ 82,875 $ 249,750 Variable manufacturing OH $ 65,156 $ 62,156 $ 187,313 Fixed manufacturing OH $ 83,333 $ 83,333 Variable S&A $ 38,750 $ 43,750 $ 125,000 Fixed S&A $ 38,333 $ 38,333 Equipment $ 150,000 $…
QUESTION 4 REQUIRED Use the information provided by empire Traders to prepare the following for March and April 2024: 4.1 Debtors Collection schedule 4.2 Cash Budget INFORMATION The following information was provided by Empire Traders: 1. Empire Traders expects to have a favourable bank balance of R60 000 on 28 february 2024. 2. Budgeted sales figures for 2024 are as follows: January February March April Cash Sales R320 000 R370 000 R310 000 R 250 000 Credit Sales R370 000 R390 000 R320 000 R300 000 3. Thirty percent (30%) of the cash sales is to informal traders who are entitled to a discount of 10%. Collections from debtors are usually as follows: 80% is collected in the month after sale 20% is collected two months after the sale 4. Purchases of inventory are expected to be as follows: January February March April Total Purchases R410 000 R460 000 R400 000 R380 000 5. Sixty percent (60) of then purchases is for cash to take advantage of a discount of 15%. The balance is purchased on…

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