Required Information [The following information applies to the questions displayed below.] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: Assets Cash Beech Corporation Balance Sheet June 30 Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 84,000 144,000 63,750 223,000 $ 514,750 $84,000 349,000 81,750 $ 514,750 Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $340,000, $360,000, $350,000, and $370,000, respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65% In the month following the sale. All of the accounts receivable at June 30 will be collected in July. 3. Each month's ending Inventory must equal 25% of the cost of next month's sales. The cost of goods sold is 75% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $44,000. Each month $6,000 of this total amount is depreciation expense and the remaining $38,000 relates to expenses that are paid in the month they are Incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.
Required Information [The following information applies to the questions displayed below.] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: Assets Cash Beech Corporation Balance Sheet June 30 Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 84,000 144,000 63,750 223,000 $ 514,750 $84,000 349,000 81,750 $ 514,750 Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $340,000, $360,000, $350,000, and $370,000, respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65% In the month following the sale. All of the accounts receivable at June 30 will be collected in July. 3. Each month's ending Inventory must equal 25% of the cost of next month's sales. The cost of goods sold is 75% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $44,000. Each month $6,000 of this total amount is depreciation expense and the remaining $38,000 relates to expenses that are paid in the month they are Incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
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2A, 2B, and 3 please
![Required Information
[The following information applies to the questions displayed below.]
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar
year. The company's balance sheet as of June 30th is shown below:
Assets
Cash
Beech Corporation
Balance Sheet
June 30
Accounts receivable
Inventory
Plant and equipment, net of depreciation
Total assets
Liabilities and Stockholders' Equity
Accounts payable
Connon stoc
Retained earnings
Total liabilities and stockholders' equity
$ 84,000
144,000
63,750
223,000
$ 514,750
$84,000
81,750
$ 514,750
Beech's managers have made the following additional assumptions and estimates:
1. Estimated sales for July, August, September, and October will be $340,000, $360,000, $350,000, and $370,000, respectively.
2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65%
In the month following the sale. All of the accounts receivable at June 30 will be collected in July.
3. Each month's ending Inventory must equal 25% of the cost of next month's sales. The cost of goods sold is 75% of sales. The
company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following
the purchase. All of the accounts payable at June 30 will be paid in July.
4. Monthly selling and administrative expenses are always $44,000. Each month $6,000 of this total amount is depreciation expense
and the remaining $38,000 relates to expenses that are paid in the month they are incurred.
5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company
does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F64f5a7ce-a444-469c-aaaf-d6378f57c470%2F55cee049-63d7-484c-ba33-f5716f8d415f%2Fbo6cwka_processed.png&w=3840&q=75)
Transcribed Image Text:Required Information
[The following information applies to the questions displayed below.]
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar
year. The company's balance sheet as of June 30th is shown below:
Assets
Cash
Beech Corporation
Balance Sheet
June 30
Accounts receivable
Inventory
Plant and equipment, net of depreciation
Total assets
Liabilities and Stockholders' Equity
Accounts payable
Connon stoc
Retained earnings
Total liabilities and stockholders' equity
$ 84,000
144,000
63,750
223,000
$ 514,750
$84,000
81,750
$ 514,750
Beech's managers have made the following additional assumptions and estimates:
1. Estimated sales for July, August, September, and October will be $340,000, $360,000, $350,000, and $370,000, respectively.
2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65%
In the month following the sale. All of the accounts receivable at June 30 will be collected in July.
3. Each month's ending Inventory must equal 25% of the cost of next month's sales. The cost of goods sold is 75% of sales. The
company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following
the purchase. All of the accounts payable at June 30 will be paid in July.
4. Monthly selling and administrative expenses are always $44,000. Each month $6,000 of this total amount is depreciation expense
and the remaining $38,000 relates to expenses that are paid in the month they are incurred.
5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company
does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.
Transcribed Image Text:Required:
1. Prepare a schedule of expected cash collections for July, August, and September.
2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the
quarter ended September 30.
2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September.
3. Prepare an Income statement that computes net operating Income for the quarter ended September 30.
4. Prepare a balance sheet as of September 30.
Answer is not complete.
Complete this question by entering your answers in the tabs below.
Req 1
Reg 2A
Req 2B
Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the
quarter ended September 30.
Budgeted cost of goods sold
Add: Desired ending merchandise inventory
Total needs
Less: Beginning merchandise inventory
Required purchases
Req 3
Merchandise Purchases Budget
July
$198,000
67,500
240,000
63,750
$ 258,750
✔
✔
Req 4
< Req 1
August September
$ 204,000
$210,000
65,625
69,375
247,200 *
250,800x
67,500✔
65,825✔
$268,125 $ 266,250
Req 2B >
Quarter
$812,000
202,500
655,200 X
196,875
$793,125
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