Wild Wood Company\'s management asks you to prepare its master budget using the

Question

Wild Wood Company's management asks you to prepare its master budget using the following information. The budget is to cover the months of April, May, & June 2014 Molly Dolls Balance Sheet March 31, 2014 Liabilities Assets Cash Accounts receivable S50,000 Accounts payable $156,000 175,000Short-term note 126,000 Total current 351,000 Long-term notes 480,000Tot abilities 12,000 168,000 200,000 368,000 Inventory liabilities Total current assets Equipment Accumulated depreciation Total assets (90,000 Common stock 235,000 $741,000 Retained earnings 138,000 Total liabilities & $741.000 uitv Additional Information Sales for March total 10,000 units. Each month's sales are expected to exceed the prior month's results by 5%. The product's selling price is $25 per unit. Company policy calls for a given month's ending inventory to equal 80% of the next month's expected unit sales. The March 31 inventory is 8,400 units, which complies with the policy. The purchase price is $15 per unit. Sales representatives' commissions are 12.5% of sales and are paid in the month of the sales. The sales manager's monthly salary will be $3,500 in April and $4,000 per month thereafter Monthly general and administrative expenses include $8,000 administrative salaries $5,000 depreciation, and 0.9% monthly interest on the long-term note payable. The company expects 30% of sales to be for cash and the remaining 70% on credit. Receivables are collected in full in the month following the sale (none is collected in the month of the sale) a. c. d. e.

Explanation / Answer

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Sales Budget April May June July Sales units 10500 11025 11576 12155 Selling price per unit 25 25 25 25 Budgeted sales value 262500 275625 289406 303877

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.