Calgon Products, a distributor of organic beverages,

Calgon Products, a distributor of organic beverages,

Calgon Products, a distributor of organic beverages,

12/7/20151.Assignment Print ViewAward: 2.00 pointsCalgon Products, a distributor of organic beverages, needs a cash budget for September. The followinginformation is available:a. The cash balance at the beginning of September is $13,500.b. Actual sales for July and August and expected sales for September are as follows:Cash salesSales on accountTotal salesJulyAugust September$ 5,100 $ 4,700 $ 7,20025,000 31,000 39,000$ 30,100 $35,700 $46,200c.d.e.f.Sales on account are collected over a three­month period as follows: 5% collected in the month of sale,65% collected in the month following sale, and 28% collected in the second month following sale. Theremaining 2% is uncollectible.Purchases of inventory will total $35,000 for September. Thirty percent of a month’s inventorypurchases are paid for during the month of purchase. The accounts payable remaining from August’sinventory purchases total $20,000, all of which will be paid in September.Selling and administrative expenses are budgeted at $15,000 for September. Of this amount, $5,000 isfor depreciation.Equipment costing $18,000 will be purchased for cash during September, and dividends totaling $4,000will be paid during the month.The company maintains a minimum cash balance of $9,500. An open line of credit is available from thecompany’s bank to bolster the cash balance as needed.Required:1. Prepare a schedule of expected cash collections for September. (Do not round intermediatecalculations.)Schedule of Expected Cash CollectionsSeptember cash sales$September collections on account:July salesAugust salesSeptember salesTotal cash collections$2. Prepare a schedule of expected cash disbursements for inventory purchases for September. (Do notround intermediate calculations.)Schedule of Expected Cash DisbursementsPayments to suppliers:August purchases$September purchasesTotal cash payments$3. Prepare a cash budget for September. Indicate in the financing section any borrowing that will beneeded during September. Assume that any interest will not be paid until the following month. (Input allamounts as positive values except cash deficiency, repayments and interest which should beindicated by a minus sign. Do not round intermediate calculations. Leave no cells blank ­ becertain to enter "0" wherever required.)http://ezto.mheducation.com/hm.tpx1/612/7/2015Assignment Print ViewCalgon ProductsCash BudgetFor the Month of SeptemberCash balance, beginningAdd cash receipts:Collections from customersTotal cash available before current financingLess disbursements:Payments to suppliers for inventorySelling and administrative expensesEquipment purchasesDividends paidTotal disbursementsExcess (deficiency) of cash available over disbursementsFinancing:BorrowingsRepaymentsInterestTotal financingCash balance, ending$$$ReferencesWorksheetLearning Objective: 07­02 Prepare a salesbudget, including aschedule of expectedcash collections.Difficulty: HardLearning Objective: 07­08 Prepare a cashbudget.Learning Objective: 07­04 Prepare a directmaterials budget,including a schedule ofexpected cashdisbursements forpurchases of materials.2.Award: 2.00 pointsThe following data relate to the operations of Picanuy Corporation, a wholesale distributor of consumergoods:Current assets as of December 31:CashAccounts receivableInventoryBuildings and equipment, netAccounts payablehttp://ezto.mheducation.com/hm.tpx$ 6,100$ 40,500$ 10,430$ 115,900$ 32,4102/612/7/2015Assignment Print ViewCapital stockRetained earnings$ 100,000$ 40,520a. The gross margin is 30% of sales. (In other words, cost of goods sold is 70% of sales.)b. Actual and budgeted sales data are as follows:December (actual)JanuaryFebruaryMarchApril$ 67,500$ 74,500$ 80,200$ 94,100$ 56,100c. Sales are 40% for cash and 60% on credit. Credit sales are collected in the month following sale. Theaccounts receivable at December 31 are the result of December credit sales.d. Each month’s ending inventory should equal 20% of the following month’s budgeted cost of goods sold.e. One­quarter of a month’s inventory purchases is paid for in the month of purchase; the other three­quarters is paid for in the following month. The accounts payable at December 31 are the result ofDecember purchases of inventory.f. Monthly expenses are as follows: commissions, $12,250; rent, $2,200; other expenses (excludingdepreciation), 8% of sales. Assume that these expenses are paid monthly. Depreciation is $2,740 forthe quarter and includes depreciation on new assets acquired during the quarter.g. Equipment will be acquired for cash: $7,200 in January and $8,090 in February.h. Management would like to maintain a minimum cash balance of $5,000 at the end of each month. Thecompany has an agreement with a local bank that allows the company to borrow in increments of$1,000 at the beginning of each month, up to a total loan balance of $50,000. The interest rate on theseloans is 1% per month, and for simplicity, we will assume that interest is not compounded. Thecompany would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter.Required:Using the data above:1. Complete the following schedule:Schedule of Expected Cash CollectionsJanuaryFebruaryCash sales$ 29,800Credit salesTotal collections$40,500$ 70,300March$$Quarter ­ Total$$$2. Complete the following: (Input all amounts as positive values. Leave no cells blank ­ be certain toenter "0" wherever required. Round the "Schedule of Expected Cash Disbursements —Merchandise Purchases" answers to 2 decimal places.)Merchandise Purchases BudgetJanuaryFebruaryBudgeted cost of goods sold$ 52,150*Add desired ending inventoryTotal needsLess beginning inventory11,228†Quarter ­ Total$63,37810,430Required purchases$ 52,948$$March$$$*$74,500 sales × 70% = $52,150.†$80,200 × 70% × 20% = $11,228.December purchasesJanuary purchasesFebruary purchasesMarch purchaseshttp://ezto.mheducation.com/hm.tpxSchedule of Expected Cash Disbursements—Merchandise PurchasesJanuaryFebruaryMarch$ 32,410.00*$$13,237.0039,711.00Quarter ­ Total$ 32,410.0052,948.003/612/7/2015Assignment Print ViewTotal disbursements$ 45,647.00$$$*Beginning balance of the accounts payable.3. Complete the following schedule:Schedule of Expected Cash Disbursements—Selling and Administrative ExpensesJanuaryFebruaryMarchQuarter ­ TotalCommissions$ 12,250$$$Rent2,200Other expenses5,960Total disbursements$ 20,410$$$4. Complete the following cash budget: (Input all amounts as positive values except cash deficiency,repayments and interest which should be indicated by a minus sign. Round your answers to 2decimal places. Leave no cells blank ­ be certain to enter "0" wherever required. Total Financingshould be indicated with a minus sign when the company is repaying amounts that werepreviously borrowed.)Cash balance, beginningAdd cash collectionsTotal cash availableLess cash disbursements:For inventoryFor operating expensesFor equipmentTotal cash disbursementsExcess (deficiency) of cashFinancing:BorrowingsRepaymentsInterestTotal financingCash balance, endingPicanuy CorporationCash BudgetJanuaryFebruary$ 6,100.00 $70,300.00MarchQuarter ­ Total$$76,400.0045,647.0020,410.007,200.0073,257.003,143.00$$$$5. Prepare an absorption costing income statement for the quarter ended March 31. (Input all amountsas positive values.)Picanuy CorporationIncome StatementFor the Quarter Ended March 31(Click to select)Cost of goods sold:(Click to select)$$(Click to select)(Click to select)(Click to select)http://ezto.mheducation.com/hm.tpx4/612/7/2015Assignment Print View(Click to select)Selling and administrative expenses:(Click to select)(Click to select)(Click to select)(Click to select)(Click to select)(Click to select)(Click to select)$6. Prepare a balance sheet as of March 31. (Be sure to list the assets and liabilities in order of theirliquidity. Round your answers to 2 decimal places.)Picanuy CorporationBalance SheetMarch 31AssetsCurrent assets:(Click to select)(Click to select)(Click to select)Total current assets(Click to select)Total assets$$$Liabilities and Stockholders’ Equity(Click to select)(Click to select)Stockholders’ equity:(Click to select)$(Click to select)Total liabilities and stockholders’ equity$rev: 03_19_2013_QC_27647ReferencesWorksheetLearning Objective: 07­04 Prepare a directmaterials budget,including a schedule ofexpected cashdisbursements forpurchases of materials.Learning Objective: 07­09 Prepare a budgetedincome statement.Difficulty: HardLearning Objective: 07­07 Prepare a sellingand administrativeexpense budget.Learning Objective: 07­10 Prepare a budgetedbalance sheet.http://ezto.mheducation.com/hm.tpx5/612/7/2015Assignment Print ViewLearningObjective: 07­02Prepare a salesbudget,including aschedule ofexpected cashcollections.Learning Objective: 07­08 Prepare a cashbudget.http://ezto.mheducation.com/hm.tpx6/6

 

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