*Exercise 9-18 ing Inc. is preparing its budget for the first quarter of 2017. T
ID: 2545178 • Letter: #
Question
*Exercise 9-18 ing 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, Clients 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, 592,440; December 2016, S83,270; January 2017, $103,690; February 2017, $121,440; March 2017, $134,410. Purchases of landscaping supplies (direct materials) are paid 60% in the month of purchase and 40% the following month. Actual purchases for 2015 and expected purchases for 2017 are December 2016, s16,270; January 2017, $15,270; February 2017, $16,730; March 2017, S21,600. (a) Prepare the following schedules for each month in the first quarter of 2017 and for the quarter in total: (1) Expected collections from clients. GREEN LANDSCAPING INC. Schedule of Expected Collections From Clients January February November December January February March Total collections (2) Expected payments for landscaping supplies. GREEN LANDSCAPING INC. Schedule of Expected Payments for Landscaping Supplies January March Quarter Docher January February March Total payments (b) Determine the following balances at March 31, 2017: (1) Accounts (5) (2) receivable Accounts payableExplanation / Answer
Schedule of expected cash collection
Schedule of expected payments for landscapping supplies :
1) Account receivable at march 31,2017 = (121440*10%+134410*40%) = 65908
2) Account payable at march 31, 2017 = 21600*40%=8640
January february March Total November 9244 9244 December 24981 8327 33308 January 62214 31107 10369 103690 February 72864 36432 109296 March 80646 80646 Total collections 96439 112298 127447 336184Related Questions
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