babyblue414 Posts: 1, Reputation: 1 New Member   #1 Apr 12, 2011, 04:28 PM

Can someone tell me what I'm doing wrong? Sales budgeted: 360,000 for November 380,000 for December 350,000 for January Collections are expected to be 75% in the month of sale, 20% in the month following the sale, and 5% uncollectable The cost of goods sold is 65% of sales The company purchases 60% of its merchandise in the month prior to the month of sale and 40$ in the month of sale. Payment is made in the month following the purchase Other monthly expenses paid in cash are 21,900 Monthly depreciation is 20,000 Ignore taxes October 31 Cash: 16,000 Accounts recievable 74,000 Inventory: 140,400 Property, plant, equipment (net of 500,000 accumulated depreciation) 1,066,000 Total assets: $1,296,400 Liabilities and stockholders equity Accounts payable: 240,000 Common stock: 640,000 Retained earnings: 416,400 Total liabilities and stockholders equity: 1,296,400 a. prepare a schedule of expected cash collections for November and December b. prepare a merchandis purchases budget for November and December c. prepare a cash budget for November and December THIS IS WHAT I HAVE... CAN SOMEONE TELL ME WHAT IM DOING WRONG? IT Doesn't LOOK RIGHT. Schedule of expected cash collections November December janurary Accounts receivable, beg. Balance 74,000 November sales: $360,000 270000 72000 December sales: $380,000 285000 76000 Total cash collections $344,000 $357,000 $76,000 Merchandise purchases budget November December Janurary Budgeted cost of goods sold 234,000 247,000 227,500 ADD desired ending merch inventory 148200 136500 Total needs 382,200 383,500 LESS beginning merch inventory 140,400 148,200 Required purchases 241,800 235,300 CASH BUDGET November December Cash balance, beginning 16,000 Add collections from sales 344,000 Total cash available 360,000 Less disbursements Other expenses 21,900 21,900 Inventory purchases 78,624 Total disbursements 100,524 Excess of cash over disbursements 259,476

Reply

babyblue414

View Public Profile

Find latest posts by babyblue414

Check out some similar questions!