The Three Brothers Enterprise has the following balance sheet as at 30 June, 2019. Assets Cash Rs. 280,000 Accounts Receivable 600,000 Less allowance for uncollectible 30,000 570,000 Inventory 525,000 Property, Plant & Equipment 1,500,000 Less accumulated depreciation 375,000 1,125,000 Total Rs. 2,500,000 Liabilities and equity Accounts payable 1,650,000 Common Stock 1,200,000 Retained earnings (deficit) (350,000) Total Rs. 2,500,000 Following information is available from the record:- Sales for July and August are budgeted at Rs. 3,300,000 and Rs. 3,600,000 respectively. Collections from sale are expected at 70% in the month of sale and 28% in the following month after sale. The balance 2% is uncollectible. The company has a gross profit of 30% of sales as practiced in the past. The purchases are 70% of the following month’s budgeted sales. The payments of purchases are made in full in the next month of purchase. The cash operating expenses are Rs. 465,000 each month which are paid in the same month. Monthly depreciation is amounting to Rs. 150,000 which is exclusive of operating expenses. Required a)Prepare a budgeted cash collection schedule and cash disbursement schedule for July 2019. b)Prepare master cash budget for July 2019. c)Prepare budgeted income statement for July, 2019.
The Three Brothers Enterprise has the following balance sheet as at 30 June, 2019.
Assets
Cash Rs. 280,000
Less allowance for uncollectible 30,000 570,000
Inventory 525,000
Property, Plant & Equipment 1,500,000
Less
Total Rs. 2,500,000
Liabilities and equity
Accounts payable 1,650,000
Common Stock 1,200,000
Total Rs. 2,500,000
Following information is available from the record:-
- Sales for July and August are budgeted at Rs. 3,300,000 and Rs. 3,600,000 respectively.
- Collections from sale are expected at 70% in the month of sale and 28% in the following month after sale. The balance 2% is uncollectible.
- The company has a gross profit of 30% of sales as practiced in the past.
- The purchases are 70% of the following month’s budgeted sales.
- The payments of purchases are made in full in the next month of purchase.
- The cash operating expenses are Rs. 465,000 each month which are paid in the same month.
- Monthly depreciation is amounting to Rs. 150,000 which is exclusive of operating expenses.
Required
a)Prepare a budgeted cash collection schedule and cash disbursement schedule for July 2019.
b)Prepare
c)Prepare
Step by step
Solved in 4 steps with 3 images
