Near the end of 2015, the management of Dimsdale Sports Co., a merchandising com
ID: 2572643 • Letter: N
Question
Near the end of 2015, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2015 DIMSDALE SPORTS COMPANY Estlmated Balance Sheet December 31, 2015 Assets Cash Accounts recelvable Inventory $ 36,000 525,000 150,000 Total current assets Equipment Less: accumulated depreclation 711,000 $540,000 67,500 Equipment, net 472,500 Total assets $ 1183,500 Liabilities and Equity Accounts payable Bank loan payable Taxes payable (due 3/15/2016) $360,000 15,000 90,000 $ 465,000 Total llablitles Common stock Retalned earnings 472,500 246,000 Total stockholders' equity 718,500 Total llablities and equity $1,183,500Explanation / Answer
Solution:
1) Sales Budget
Sales Budget
Budgeted Unit Sales
Budgeted Unit Price
Budgeted Total Sales
January
7000
$55
$385,000
February
9000
$55
$495,000
March
11000
$55
$605,000
Totals for the quarter
$1,485,000
2) Merchandise Purchases Budget
Merchandise Purchases Budget
January
February
March
Next Month’s Budgeted Sales (units)
9000
11000
10000
Ratio of inventor to future sales
20%
20%
20%
Budgeted Ending Inventory (units)
1800
2200
2000
Plus: Budgeted Sales (Units)
7000
9000
11000
Required units of available merchandise
8800
11200
13000
Less: Beginning Inventory (units)
5000
1800
2200
Units to be purchased
3800
9400
10800
Unit Purchase Cost
$30
$30
$30
Merchandise Purchases Budget (dollars)
$114,000
$282,000
$324,000
3) Monthly Selling Expenses Budget
Selling Expense Budget
January
February
March
Total
Budgeted Sales
$385,000
$495,000
$605,000
$1,485,000
% of Sales Commission over sales
20%
20%
20%
20%
Sales Commission
$77,000
$99,000
$121,000
$297,000
Salary of Sales's Manager (Fixed)
$5,000
$5,000
$5,000
$15,000
Budgeted Total Selling Expense
$82,000
$104,000
$126,000
$312,000
4) Monthly general and administrative expense budgets
General and Administrative Expense Budget
January
February
March
Total
Administrative Salaries
$12,000
$12,000
$12,000
$36,000
Maintenance Expense
$2,000
$2,000
$2,000
$6,000
Total General and Administrative Expense Budget
$14,000
$14,000
$14,000
$42,000
Hope the above calculations, working and explanations are clear to you and help you in understanding the concept of question.... please rate my answer...in case any doubt, post a comment and I will try to resolve the doubt ASAP…thank you
Pls ask separate question for remaining part.
Sales Budget
Budgeted Unit Sales
Budgeted Unit Price
Budgeted Total Sales
January
7000
$55
$385,000
February
9000
$55
$495,000
March
11000
$55
$605,000
Totals for the quarter
$1,485,000
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