You are responsible for preparing a cash budget for Country Quilts and have collected the following details: a. The cash balance on September 1 is $46,000 b. Actual sales for July and August and budgeted sales for September are shown below. Sales on account are collected over a three- month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 20% collected in the second month following sale. The company's bad debts are negligible. Cash sales Sales on account July $ 78,200 $460,000 August $ 77,600 $534,000 September $ 95,000 $606,000 c. Purchases of Inventory will total $352,000 for September. Forty percent of a month's Inventory purchases are paid during the month of purchase. The accounts payable remaining from August's Inventory purchases total $209.000, all of which will be paid in September. d. Selling and administrative expenses are budgeted at $505,000 for September. Of this amount, $60,7001s for depreciation and $550is for property taxes. e. Annual property taxes of $102,000 will be paid during September. f. The company maintains a minimum cash balance of $20,000.An open line of credit is available from the company's bank to bolster the cash position as needed. All borrowing occurs at the beginning of a month. Required: 1. Prepare a schedule of expected cash collections for September. Schedule of Expected Cash Collections December cash sales Collections on account October sales November sales December sales Total cash collections
You are responsible for preparing a cash budget for Country Quilts and have collected the following details: a. The cash balance on September 1 is $46,000 b. Actual sales for July and August and budgeted sales for September are shown below. Sales on account are collected over a three- month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 20% collected in the second month following sale. The company's bad debts are negligible. Cash sales Sales on account July $ 78,200 $460,000 August $ 77,600 $534,000 September $ 95,000 $606,000 c. Purchases of Inventory will total $352,000 for September. Forty percent of a month's Inventory purchases are paid during the month of purchase. The accounts payable remaining from August's Inventory purchases total $209.000, all of which will be paid in September. d. Selling and administrative expenses are budgeted at $505,000 for September. Of this amount, $60,7001s for depreciation and $550is for property taxes. e. Annual property taxes of $102,000 will be paid during September. f. The company maintains a minimum cash balance of $20,000.An open line of credit is available from the company's bank to bolster the cash position as needed. All borrowing occurs at the beginning of a month. Required: 1. Prepare a schedule of expected cash collections for September. Schedule of Expected Cash Collections December cash sales Collections on account October sales November sales December sales Total cash collections
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
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.
Question
i need the answer quickly
Transcribed Image Text:You are responsible for preparing a cash budget for Country Quilts and have collected the following details:
a. The cash balance on September 1 is $46,000
b. Actual sales for July and August and budgeted sales for September are shown below. Sales on account are collected over a three-
month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 20% collected in the
second month following sale. The company's bad debts are negligible.
Cash sales
Sales on account
July
$ 78,200
$460,000
August
$ 77,600
$534,000
September
$ 95,000
$606,000
c. Purchases of inventory will total $352,000 for September. Forty percent of a month's inventory purchases are paid during the
month of purchase. The accounts payable remaining from August's Inventory purchases total $209,000, all of which will be paid In
September.
d. Selling and administrative expenses are budgeted at $505,000 for September. Of this amount, $60,7001s for depreciation and
$5501s for property taxes.
e. Annual property taxes of $102,000 will be paid during September.
f. The company maintains a minimum cash balance of $20,000.An open line of credit is available from the company's bank to bolster
the cash position as needed. All borrowing occurs at the beginning of a month.
Required:
1. Prepare a schedule of expected cash collections for September.
Schedule of Expected Cash Collections
December cash sales
Collections on account
October sales
November sales
December sales
Total cash collections
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 3 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education