Problem 6Tomtom store seeks your assistance to develop cash and other budget informationfor May, June, and July 2009. On April 30, 2009, the company had cash balance ofPhp5,500.The budget is based on the following assumptions:A. Sales1. Each month's sales are billed on the last day of the month2. Customers are allowed 3% discount if payment is made within 10 daysafter the billing date.Accounts receivable are booked gross.3. Sixty percent of the billings are collected within the discount period, 25%are collected by the end of the month where discount period is allowed,9% are collected by the end of the end second month, and 6% proveuncollectible.B. Purchases1. 54% of all purchases of materials and selling, general and administrativeexpenses are paid at the month purchased and the remainder in thefollowing month.2. Each month's unit of ending inventory is equal to 130% of the month'sunits of sales.3. The cost of each unit of inventory is P20.4. Selling, general and administrative expenses, of which P2.000 isdepreciation, are equal to 15% of the current month's sales.Actual and projected sales are as follows:Pesos354,000363,000357,000342,000360,000366,0002009MarchUnits11,80012,100AprilMayJuneJulyAugust11,90011,40012,00012,200Required: Prepare each forecast for the month May, June, and July. 2009 supportedby the followingSchedules:a. Cash receipts from receivables.b. Purchases of inventoryc. Cash disbursement on accounts payable.d. Cash disbursement on selling, general, and administrative expenses.

stomers are allowed 3% discount if payment is made r the billing date. counts receivable are booked gross. ty percent of the billings are collected within the disc collected by the end of the month where discount p are collected by the end of the end second month, a collectible. ses 6 of all purchases of materials and selling, general a enses are paid at the month purchased and the rem Dwing month. ch month's unit of ending inventory is equal to 130% s of sales. e cost of each unit of inventory is P20. ling, general and administrative expenses, of which reciation are anual to ual to 15% of the current month

stomers are allowed 3% discount if payment is made r the billing date. counts receivable are booked gross. ty percent of the billings are collected within the disc collected by the end of the month where discount p are collected by the end of the end second month, a collectible. ses 6 of all purchases of materials and selling, general a enses are paid at the month purchased and the rem Dwing month. ch month's unit of ending inventory is equal to 130% s of sales. e cost of each unit of inventory is P20. ling, general and administrative expenses, of which reciation are anual to ual to 15% of the current month

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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