Schedule of Cash Payments for a Service CompanySafeMark Financial Inc. was organized on February 28. Projected selling and admin istrative expenses for each of the first three months of operations are as follows:March$154,900April144,100131,100MayDepreciation, insurance, and property taxes represent $33,000 of the estimated monthly expenses. The annual insurance premium was paid on February 28, and property taxes for the year will be paid in June. 64%of the remainder of the expenses are expected to be paid in the month in which they are incurred, with the balance to be paid in the following monthPrepare a schedule indicating cash payments for selling and administrative expenses for March, April, and May.SafelMark Financial Inc.Schedule of Cash Payments for Selling and Administrative ExpensesFor the Three Months Ending May 31MarchAprilMayMarch expensesPaid in MarchPaid in AprilApril expenses:Paid in AprilPaid in MayMay expensesPaid in MayTotal cash payments

Definition of Budgeting:Budgeting is a process of creating a plan to spend your money. Creating this…

Answered: Schedule of Cash Payments for a Service…

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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All sales are made on credit terms of net 30 days and are collected the following month and no bad debts are anticipated. The accounts receivable on the balance sheet at the end of September thus will be collected in October. The October sales will be collected in November, and so on. Inventory on hand represents a minimum operating level (or “safety” stock), which the company intends to maintain. Cost of goods sold average 80 percent of sales. Inventory is purchased in the month of sale and paid for in cash. Other cash expenses average 7 percent of sales. Depreciation is $10,000 per month. Assume taxes are paid monthly and the effective income tax rate is 40 percent for planning purposes. The annual interest rate on outstanding long-term debt and bank loans (notes payable) is 12%. There are no capital expenditures planned during the period, and no dividends will be paid. The company’s desired end-of-month cash balance is $80,000. The president hopes to meet any cash shortages during…
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Schedule of cash payments for a service company Horizon Financial Inc. was organized on February 28. Projected selling and administrative expenses for each of the first three months of operations are as follows: March $143,400 April 131,900 May 120,000 Depreciation, insurance, and property taxes represent $30,000 of the estimated monthly expenses. The annual insurance premium was paid on February 28, and property taxes for the year will be paid in June. 63% of the remainder of the expenses are expected to be paid in the month in which they are incurred, with the balance to be paid in the following month. Prepare a schedule of cash payments for selling and administrative expenses for March, April, and May.
Munoz Pointers Corporation expects to begin operations on January 1, year 1; it will operate as a specialty sales company that sells laser pointers over the Internet. Munoz expects sales in January year 1 to total $270,000 and to increase 15 percent per month in February and March. All sales are on account. Munoz expects to collect 69 percent of accounts receivable in the month of sale, 24 percent in the month following the sale, and 7 percent in the second month following the sale. Required a. Prepare a sales budget for the first quarter of year 1. b. Determine the amount of sales revenue Munoz will report on the year 1 first quarterly pro forma income statement. c. Prepare a cash receipts schedule for the first quarter of year 1. d. Determine the amount of accounts receivable as of March 31, year 1. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Determine the amount of accounts receivable as of March 31, year 1. (Do not…
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Forecasted cash receipts and expenditure for the period August to October are as follows: Cash Receipts Expenditure $ $ 60,000 58,000 July August September October 54000 68,000 90,000 30,000 44,000 Additional information provided: ✓ Expenditure for the period July to October includes monthly depreciation of $5,000. ✓ Payment for the cash related expenditure would be 40% in the month of purchase, the balance being paid the following month. The company intends to sell equipment valued at $25,000 in September. Insurance of $25,000 is payable in December. Opening cash balance as at August 1, $18,800. Required: Prepare a monthly Cash Budget for the period August to October 2021.
Walton Pointers Corporation expects to begin operations on January 1, year 1; it will operate as a specialty sales company that sells laser pointers over the Internet Walton expects sales in January year 1 to total $260,000 and to Increase 15 percent per month in February and March All sales are on account. Walton expects to collect 67 percen of accounts receivable in the month of sale, 21 percent in the month following the sale, and 12 percent in the second month following the sole Required a. Prepare a sales budget for the first quarter of year 1 b. Determine the amount of sales revenue Walton will report on the year 1 first quarterly pro forma Income statement. c. Prepare a cash receipts schedule for the first quarter of year 1 d. Determine the amount of accounts receivable as of March 31, your 1 Complete this question by entering your answers In Use tabs below. Required A Required B Required C Required D Prepare a cash receipts schedule for the first quarter of year (out road…
Sales in December were $960,000. Projected sales for the first quarter of next year are: January $1,080,000 February $1,300,000 March $1,280,000 Sales are 20% cash and 80% on credit. Debtors pay in the month following the sale. Calculate the total cash sales for the three months, January, February and March. Select one: O a. $732,000 O b. $256,000 O c. $960,000 O d. $2,848,000 O e. none of these
The table contains the Sales estimates for the next year. The Purchases are 55% of Sales. Purchases are paid in the following month. The administrative expenses of $11,550 are paid each month Tax expenses of $16,458 are paid in March, June, September, and December each year. Rent expenses of $47,735 are paid in June and December. What is the cash outflow for March? Month Sales $ Month Sales $ Jan 87,400 July 21,931 Feb 89,751 Aug 78,038 Mar 78,038 Sep 87,400 Apr 21,931 Oct 78,038 May 87,400 Nov 89,751 June 89,751 Dec 21,931
Miggy Co. projects the following monthly revenues for next year: 250,000 January February March 100,000 500,000 July August September October 275,000 300,000 350,000 452,000 450,000 Аpril May 557,000 300,000 November 400,000 525,000 June December Miggy's terms are net 30 days. The company typically receives payment on 80% of sales the month following the sale and 17% is collected two months after the sale. Approximately 3% of sales are deemed bad debt. What amount represents the expected cash collection in the second calendar quarter of next year? a. 1,405,540 b. 1,293,630 c. 1,320,540 d. 1,234,250
Schedule of cash collections of accounts receivable OfficeMart Inc. has "cash and carry" customers and credit customers. OfficeMart estimates that 25% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 30% pay their accounts in the month of sale, while the remaining 70% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows: October $58,000 November 65,000 December 72,000 The Accounts Receivable balance on September 30 was $35,000. Prepare a schedule of cash collections from sales for October, November, and December. Enter all amounts as positive numbers. OfficeMart Inc. Schedule of Cash Collections from Sales For the Three Months Ending December 31 Line Item Description Receipts from cash sales: Cash sales September sales on account: Collected in October October sales on account: Collected in October Collected in November November sales on account: Collected…
Karim Corp. requires a minimum $9,000 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash balance on July 1 is $9,400, and the company has no outstanding loans. Forecasted cash receipts (other than for loans received) and forecasted cash payments (other than for loan or interest payments) follow. July August September Cash receipts $ 25,000 $ 33,000 $ 41,000 Cash payments 29,500 31,000 33,000 Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) KARIM CORP. Cash Budget For July, August, and September July August September Beginning cash balance $9,400 Total cash available Preliminary cash balance Ending cash…

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