CACULATORI?FULL SCREEN!! PRINTER VERSION -BACK Exercise 9-18 Green Landscaping I

Question

CACULATORI?FULL SCREEN!! PRINTER VERSION -BACK Exercise 9-18 Green Landscaping Inc. is preparing its budget for the first quarter of 2017. The next step in the budgeting process is to prepare a cash receipts schedule and a cash payments schedule. To that end the following information has been collected. dients usually pay 60% of their fee in the month that service is performed, 30% the month after, and 10% the second month after receiving service, Actual service revenue for 2016 and expected service revenues for 2017 are November 2016, $93,280; December 2016, $84,030; January 2017, $102,060; February 2017, $123,830; March 2017, $132,290 Purchases of landscaping supplies direct materials are paid 60% in the month of purchase and 40% the following month. Actual purchases for 2016 and expected purchases for 2017 are December 2016, $16,950: January 2017, $17,820; February 2017, $17,750; March 2017, $19,030. Prepare the following schedules for each month in the first quarter of 2017 and for the quarter in total: (1) Expected collections from dients GREEN LANDSCAPING INC Schedule of Expected Collections From Clients For the Querter Ending March 312017 January February Harch Quarter November December January February 93200 $ $ 9320 shared assignmenttest aglit nilhanm2198381;N 100 Arved. A Dris on ong nmtasera

Explanation / Answer

Solution a:

Solution b:

Balance of accounts receivables on Mar 31, 2017 = 10% of expected revenue of feb + 40% of expected revenue of march

= $123,830 * 10% + $132,290*40% = $65,299

Balance of accounts payable on mar 31, 2017 = 40% of march purchases

= $19,030 * 40% = $7,612

Green Landscaping Inc. Schedule of expected cash collection from clients For the quarter ended March 31, 2017 Particulars January Feburary March Quarter Budgeted Service Revenue $102,060.00 $123,830.00 $132,290.00 $358,180.00 Collection of cash against sales (60% same month,30% next month, 10% second month after receiving service ): Cash collection of November Service Revenue $9,328.00 $9,328.00 Cash collection of December Service Revenue $25,209.00 $8,403.00 $33,612.00 Cash collection of January Service Revenue $61,236.00 $30,618.00 $10,206.00 $102,060.00 Cash collection of feburary Service Revenue $74,298.00 $37,149.00 $111,447.00 Cash collection of March Service Revenue $79,374.00 $79,374.00 Total Expected Cash Collection $95,773.00 $113,319.00 $126,729.00 $335,821.00

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