Safari File Edit View History Bookmarks Window Help 18%Fri 12:46 AM a E Budget P
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Safari File Edit View History Bookmarks Window Help 18%Fri 12:46 AM a E Budget Project Saved Help 5ave &Exit; Submit Check my work Perez Company retal como any that specalzes n seling outdoor carong equipment. The company ls considering opening a new store on October 1, 2019. The company president formed a planning committec to prepare a mastor budget for the fra three months of operation. As budget coo dinator you have been assigned the following tasks Part 1 of 2 Problem 14-23 Part 1 25 ponts Required a. October salos are ostimated to bo $220,000, of which 45 parcont will bo cash and 55 porcem will bo credt. Tho b. The co pany expects to collect 100 percont of the accounts recavabie ganarated by credt sales in the momt C. The cost of goods sd60 percent of salos. The company desiros to maintain a minimum anding invemory oqual to company oxpes sales to increaso at tho race of 20 percent per monn Proparo a sa es budgot tolowing tho sale. Proparo a scnodue of cash recoi. 10 percent of the no month's cost of goods soid However, ending Inventory of Decomber is expected to Do Print $13,000. Assume that all purchases are made on account. Prepare an inventory purchases budgat d The company pays 80 percem of accoun payabie in the month of purchase and the romaining 20 percont in the Reference tolowing month. Propare a cash payments budgee for inventory purchases Budgeted seling and administrative expenses per montn folow. Salary oxPanao ?xod) 19, D00 Supelion axponee Ctilitioa fixod) fixturon (fixod)* 2.400 5,00O 2,200 The captal expendltures budget Ind cetes thet Perez will spend $210,000 on October 1 for store ftures, which are expected to heve a $30,000 salvage value end & three year (36-mon) usefui Iife. Use this information to prepae a seling and acministrative expenses budget whicn thay aro Incurred. Proparo a cash payments budget for seling and administratihe axponses t. UtiTes and salos commissions are paild the month ater thay are incurredt all other oxponses ane paid in the month in 9 Perez bormows funds, in incroments of $t,ooo, and ropays them on the last day of the month Ropaymes may be made in any amoun avalabie. The company aso pays its endors on the last day of the montn. tpays Iterest of 1 percent per montn in casn on the ast day of tno month. To De prudent, the company deres to maintain ?? $22,000 cash cushion. Proparo a cash budgot Complete this question by entering your answers in the tabs below. Required Required Required Required Required Required Required Perez borrows funds, in increments of $1,000, and repays them on the last day of the month. Repayments may be made in any amount available. The company also pays its vendors on the last day of the month. It pays interest of 1 percent per month in cash on Prev 1 Next >Explanation / Answer
1a Sales in October $220,000 Sales in November $264,000 (220000*1.2) Sales in December $316,800 (264000*1.2) SALES BUDGET October November December A=0.45*C Cash sales $99,000 $118,800 $142,560 B=0.55*C Credit Sales $121,000 $145,200 $174,240 C=A+B Total Sales $220,000 $264,000 $316,800 1b SCHEDULE OF CASH RECEIPT October November December A Collection from cash sales $99,000 $118,800 $142,560 B Collection from credit sales $0 $121,000 $145,200 C=A+B Total cash receipt $99,000 $239,800 $287,760 1c INVENTORY PURCHASE BUDGET October November December A Sales $220,000 $264,000 $316,800 B=0.6*A Cost of goods sold $132,000 $158,400 $190,080 C Ending Inventory $15,840 $19,008 $13,000 (Ending Inventory of October=(0.1*158400), November=(0.1*190080) D=B+C Total Inventory $147,840 $177,408 $203,080 E Less:Beginning Inventory $0 $15,840 $19,008 F=D-E Inventory Purchase required $147,840 $161,568 $184,072 1d CASH PAYMENT BUDGET FOR INVENTORY PURCHASE October November December A Inventory Purchase $147,840 $161,568 $184,072 B=A*0.8 Payment in the month of purchase $118,272 $129,254 $147,258 C Payment in the following month $29,568.0 $32,313.6 D=B+C Total Cash payment for inventory Purchase $118,272 $158,822 $179,571
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