need the answers to do the cash budget Help Save & Exit Submit Check my work Req

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need the answers to do the cash budget

Help Save & Exit Submit Check my work Required intormation Problem 14-23 Preparing a master budget for retail company with no beginning account balances LO 14-2, 14-3, 14-4, 14-5, 14-6 The folowing information appves to the questions displayed below. Adams Company is a retail company that specializes in seling outdoor camping equipment. Tre planning committee to prepare a master budget for the first three months of operation. As budget onsidering opening a new store on October 1, 2019 The company president formed a coordinator, you have been assigned the following tasks Problem 14-23 Part 1 Required a. October sales are estimated to be $200,000, of which 40 percent will be cash and 60 percent will be credit. The company expects sales to increase at the rate of 25 percent per month. Prepare a sales budget. The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month follawi sale Prepare a schedule of cash receipts e. The cost of goods sold is 60 percent of sales. The company deaires to maintain a minimum ending inventory equal to t0 d. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the e. Budgeted selling and administrative expenses per month follow: percent of the next month's cost of goods sold. However, ending inventory of December is expected to be $12.000. Assume that all purchases are made on account. Prepare an inventory purchases bu dget following month. Prepare a cash payments budget for inventory purchases

Explanation / Answer

Sales Budget October November December Total Budgeted Sales 200000 250000 312500 762500 Cash Sales 80000 100000 125000 305000 Credit Sales 120000 150000 187500 457500 Schedule of expected cash collections October November December Total Cash sales 80000 100000 125000 305000 Credit Sales: 0 October Sales 120000 120000 November Sales 150000 150000 Total Collections 80000 220000 275000 575000 Purchase Budget October November December Total Budgeted Sales 200000 250000 312500 762500 Cost of goods sold (60% of sales) 120000 150000 187500 457500 Add:Desired ending inventory of cost of goods sold 15000 18750 12000 12000 (10% on next month's cost of goods sold) Total cost of goods sold 135000 168750 199500 469500 Less: Beginning Inventory of cost of goods sold 0 15000 18750 0 Budgeted purchases 135000 153750 180750 469500 Schedule of payment for cost of goods sold October November December Total Budgeted Purchases 135000 153750 180750 469500 Payments: In the month of purchase 94500 107625 126525 328650 Inthe following month 40500 46125 86625 Budgeted Purchases 94500 148125 172650 415275 Selling and administrativebudget October November December Total Salary Expense 18000 18000 18000 54000 Salaries Expense (5% of sales) 10000 12500 15625 38125 Supplies Expense (2% of sales) 4000 5000 6250 15250 Utilities Expense 1400 1400 1400 4200 Depreciation on stores fixtures 4000 4000 4000 12000 Rent 4800 4800 4800 14400 Miscellaneous expenses 1200 1200 1200 3600 Total selling and admn. Expenses 43400 46900 51275 141575 Selling and administrativebudget October November December Total Salary Expense 18000 18000 18000 54000 Salaries Expense (5% of sales) 0 10000 12500 22500 Supplies Expense (2% of sales) 4000 5000 6250 15250 Utilities Expense 0 1400 1400 2800 Depreciation on stores fixtures 4000 4000 4000 12000 Rent 4800 4800 4800 14400 Miscellaneous expenses 1200 1200 1200 3600 Payment for selling and admn. Expenses 32000 44400 48150 124550 Cash Budget October November December Total Beginning Cash Balance 0 14500 12475 0 Collections from customers 80000 220000 275000 575000 Total Cash available for disbursements 80000 234500 287475 575000 Cash disbursements:    For purchases 94500 148125 172650 415275    For selling and admn. Expenses 32000 44400 48150 124550    For Capital Expenditure 164000 164000 Total Cash disbursements 290500 192525 220800 703825 Cash surplus / (Deficit) -210500 41975 66675 -128825 Minimumcash balance 12000 12000 12000 12000 Excess / (shortfall) -222500 29975 54675 -140825 Financing Borrowing 225000 225000 Repayment -25000 -52000 -77000 Interest -4500 -2000 -6500 Total 225000 -29500 -54000 141500 Ending cash balance 14500 12475 12675 12675

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