Use the following information to prepare the July cash budget for Acco Company. Ignore the "Loan activity" section of the budget a. Beginning cash balance on July 1: $64,000. b. Budgeted cash receipts from sales: 15% is collected in the month of sale, 50% in the next month, and 35% in the second month after sale. Sales amounts are May (actual), $1,940,000; June (actual), $1,310,000; and July (budgeted), $1,410,000. c. Budgeted cash payments on merchandise purchases: 90% in the month of purchase and 10% in the month following purchase. Purchase amounts are June (actual), $530,000; and July (budgeted), $640,000. d. Budgeted cash payments for salaries in July: $380,000. e. Budgeted cash payments for sales commissions for July: $290,000. f. Budgeted cash payment for income taxes in July: $80,000. g. Budgeted cash payment for loan interest in July: $9,000.

Use the following information to prepare the July cash budget for Acco Company. Ignore the "Loan activity" section of the budget a. Beginning cash balance on July 1: $64,000. b. Budgeted cash receipts from sales: 15% is collected in the month of sale, 50% in the next month, and 35% in the second month after sale. Sales amounts are May (actual), $1,940,000; June (actual), $1,310,000; and July (budgeted), $1,410,000. c. Budgeted cash payments on merchandise purchases: 90% in the month of purchase and 10% in the month following purchase. Purchase amounts are June (actual), $530,000; and July (budgeted), $640,000. d. Budgeted cash payments for salaries in July: $380,000. e. Budgeted cash payments for sales commissions for July: $290,000. f. Budgeted cash payment for income taxes in July: $80,000. g. Budgeted cash payment for loan interest in July: $9,000.

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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On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the company's sales are made on account. The following information has been provided by Spicer's management. Month January February March April May Credit Sales $ 300,000 (actual) 400,000 (actual) 559,000 (estimated) 556,000 (estimated) 800,000 (estimated) The company's collection activity on credit sales historically has been as follows. Collections in the month of the sale Collections one month after the sale. Collections two months after the sale Uncollectible accounts. 50% 30 Cash balance on March 31 Cash balance on April 30 Cash balance on May 31 15 5 Spicer's total cash expenditures for March, April, and May have been estimated at $1.200,000 (an average of $400.000 per month). Its cash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarter. Compute Spicer's budgeted cash…
On March 1 of the current year, Spicer Corporation compiled information to prepare a cash budget for March, April, and May. All of the company's sales are made on account. The following information has been provided by Spicer's management. Month Credit Sales January $ 300,000 (actual) February 400,000 (actual) March 629,000 (estimated) April 571,000 (estimated) May 800,000 (estimated) The company's collection activity on credit sales historically has been as follows. Collections in the month of the sale 50 % Collections one month after the sale 30 Collections two months after the sale 15 Uncollectible accounts 5 Spicer's total cash expenditures for March, April, and May have been estimated at $1,200,000 (an average of $400, 000 per month). Its cash balance on March 1 of the current year is $500,000. No financing or investing activities are anticipated during the second quarter. Compute Spicer's budgeted cash balance at the ends of March, April, and May.
The following information was taken from Bonita Industries's cash budget for the month of July: Beginning cash balance $440000 Cash receipts 404000 Cash disbursements 558000 If the company's policy is to maintain a minimum end of the month cash balance of $430000, the amount the company would have to borrow in July is $286000. $144000. $10000. $26000.
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1. Prepare a budgeted income statement for the month ended July 31st. Use an absorption format. a. Calculate the estimated operating cycle for the month of July. (Hint: Use 30 days in the numerator to calculate the average collection period and the average sales period.)
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