Thornton is a retail company specializing in men's hats. Its budget director prepared the list of expected operating expenses that follows. All items are paid when incurred except sales commissions and utilities, which are paid in the month following their incurrence. July is the first month of operations, so there are no beginning account balances. Salary expense September $ 18,100 Sales commissions (4 percent of sales) Supplies expense Utilities Depreciation on store equipment Rent Miscellaneous July $ 18,100 2,000 August $ 18,100 2,000 2,000 320 350 380 2,500 2,500 2,500 3,100 3,100 3,100 5,700 5,700 5,700 690 690 690 Total S&A expenses before interest $ 32,410 $ 32,440 $ 32,470 Required a. Prepare a schedule of cash payments for selling and administrative expenses. b. Determine the amount of utilities payable as of September 30. c. Determine the amount of sales commissions payable as of September 30.
Thornton is a retail company specializing in men's hats. Its budget director prepared the list of expected operating expenses that follows. All items are paid when incurred except sales commissions and utilities, which are paid in the month following their incurrence. July is the first month of operations, so there are no beginning account balances. Salary expense September $ 18,100 Sales commissions (4 percent of sales) Supplies expense Utilities Depreciation on store equipment Rent Miscellaneous July $ 18,100 2,000 August $ 18,100 2,000 2,000 320 350 380 2,500 2,500 2,500 3,100 3,100 3,100 5,700 5,700 5,700 690 690 690 Total S&A expenses before interest $ 32,410 $ 32,440 $ 32,470 Required a. Prepare a schedule of cash payments for selling and administrative expenses. b. Determine the amount of utilities payable as of September 30. c. Determine the amount of sales commissions payable as of September 30.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Thornton is a retail company specializing in men's hats. Its budget director prepared the list of expected operating expenses that
follows. All items are paid when incurred except sales commissions and utilities, which are paid in the month following their incurrence.
July is the first month of operations, so there are no beginning account balances.
Salary expense
September
$ 18,100
Sales commissions (4 percent of sales)
Supplies expense
Utilities
Depreciation on store equipment
Rent
Miscellaneous
July
$ 18,100
2,000
August
$ 18,100
2,000
2,000
320
350
380
2,500
2,500
2,500
3,100
3,100
3,100
5,700
5,700
5,700
690
690
690
Total S&A expenses before interest
$ 32,410
$ 32,440
$ 32,470
Required
a. Prepare a schedule of cash payments for selling and administrative expenses.
b. Determine the amount of utilities payable as of September 30.
c. Determine the amount of sales commissions payable as of September 30.
Complete this question by entering your answers in the tabs below.
Req A
Req B and C
Prepare a schedule of cash payments for selling and administrative expenses.
Schedule of Cash Payments for Selling and
Admin Expenses
July
August September
Total payments for S&A expenses
$
0
$
0 $
0
<Req A
Req B and C >
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