Berman Company is preparing its budget for the third quarter. Cash balance on July 31 was $30,000. Assume there is no minimum balance of cash required and no borrowing is undertaken. Additional budgeted data are provided here: July Aug Sep Cash collections $53,000 $53,000 $51,000 Cash payments Purchases of direct materials 19,000 22,000 21,000 Operating expenses 29,000 30,000 22,000 Capital expenditures 9,000 12,000 12,000 Calculate the projected balance of cash at the end of August. OA. $19,000 OB. $34,000 OC. $31,000 OD. $117,000

Berman Company is preparing its budget for the third quarter. Cash balance on July 31 was $30,000. Assume there is no minimum balance of cash required and no borrowing is undertaken. Additional budgeted data are provided here: July Aug Sep Cash collections $53,000 $53,000 $51,000 Cash payments Purchases of direct materials 19,000 22,000 21,000 Operating expenses 29,000 30,000 22,000 Capital expenditures 9,000 12,000 12,000 Calculate the projected balance of cash at the end of August. OA. $19,000 OB. $34,000 OC. $31,000 OD. $117,000

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 6BE: Cash budget Pasadena Candle Inc. pays 40% of its purchases on account in the month of the purchase...

See similar textbooks

Similar questions

Relevant data from the operating budget of The Framers are: Other data: Capital assets were sold in quarter 1 and $8,000 was collected in quarter 1 and $500 collected in quarter 2. Dividends of $500 will be paid in May The beginning cash balance was $50,000 and a required minimum cash balance is $10,000. Prepare a cash budget for the first two quarters of the year.
Budgeted income statement and balance sheet As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 20Y9, the following tentative trial balance as of December 31, 20Y8, is prepared by the Accounting Department of Mesa Publishing Co.: Factory output and sales for 20Y9 are expected to total 3,800 units of product, which are to be sold at 120 per unit. The quantities and costs of the inventories at December 31, 20Y9, are expected to remain unchanged from the balances at the beginning of the year. Budget estimates of manufacturing costs and operating expenses for the year are summarized as follows: Balances of accounts receivable, prepaid expenses, and accounts payable at the end of the year are not expected to differ significantly from the beginning balances. Federal income tax of 35,000 on 20Y9 taxable income will be paid during 20Y9. Regular quarterly cash dividends of 0.20 per share are expected to be declared and paid in March, June, September, and December on 20,000 shares of common stock outstanding. It is anticipated that fixed assets will be purchased for 22,000 cash in May. Instructions Prepare a budgeted income statement for 20Y9. Prepare a budgeted balance sheet as of December 31, 20Y9, with supporting calculations.
A companys controller is adjusting next years budget to reflect the impact of an expected 3 percent inflation rate. Listed below are selected items from next years budget before the adjustment. After adjusting for the 3 percent inflation rate, what is the companys total budget for the selected items before taxes for next year? a. 858,150 b. 860,412 c. 810,971 d. 858,971
A. Discuss the purpose of the cash budget. B. If the cash for the first quarter of the fiscal year indicates excess cash at the end of each of the first two months, how might the excess cash be used?
Mesa Aquatics, Inc. estimated direct labor hours as 1,900 in quarter 1, 2,000 in quarter 2.2,200 in quarter 3, and 1,800 in quarter 4. a sales and administration budget using the information provided.
Using the information for Crable and Tesch, the systems consultants in P9-3 and P9-4, prepare a budgeted income statement for the year ended December 31, 2016.
Budgeted selling and administrative expenses for King Tire Co. In P7-2 for the year ended December 31, 2016, were as follows: Required: 1. Prepare a selling and administrative expense budget, in good form, for the year 2016. 2. Using the information above and the budgets prepared in P7-2, prepare a budgeted income statement for the year 2016, assuming an income tax rate of 40%.
Fairview Medical Supply has applied for a loan. First American Bank has requested a budgeted balance sheet as of April 30, and a combined cash budget for April. As Fairview Medical Supply's controller, you have assembled the following information: a. March 31 equipment balance, $52,700; accumulated depreciation, $41,100. b. April capital expenditures of $42,700 budgeted for cash purchase of equipment. c. April depreciation expense, $500. d. Cost of goods sold, 60% of sales. e. Other April operating expenses, including income tax, total $13,400, 30%of which will be paid in cash and the remainder accrued at April 30. f. March 31 owners' equity, $93,600. g. March 31 cash balance, $40,100. h. April budgeted sales, $91,000, 70% of which is for cash. Of the remaining 30%, half will be collected in April and half in May. i. April cash collections on March sales, $29,200. j. April cash payments of March 31 liabilities incurred…
Hugo Medical Supply has applied for a loan. Pacific Commerce Bank has requested a budgeted balance sheet as of April 30, and a combined cash budget for April. As Hugo Medical Supply's controller, you have assembled the following information: a. March 31 equipment balance, $52,600; accumulated depreciation, $41,300. b. April capital expenditures of $ 42,400 budgeted for cash purchase of equipment. c. April depreciation expense, $700. d. Cost of goods sold, 60%of sales. e. Other April operating expenses, including income tax, total $14,200, 35% of which will be paid in cash and the remainder accrued at April 30. f. March 31 owners' equity, $92,600. g. March 31 cash balance, $40,300. h. April budgeted sales, $90,000, 70% of which is for cash. Of the remaining 30%, half will be collected in April and half in May. i. April cash collections on March sales, $29,100. j. April cash payments of March 31 liabilities incurred for March…
2.cengagenow.com/ilrn/takeAssignment/takeAssignmentMain.do?invoker-assignments&takeAssignmentS... A Estimated cash payments budget Grow Inc. was organized on February 28. Budgeted selling and administrative expenses for each of the first three months of operations are as follows: March April May $101,500 93,400 85,000 Depreciation, insurance, and property taxes represent $21,000 of the estimated monthly expenses. The annual insurance premium was paid on February 28, and property taxes for the year will be paid in November. The remainder of the expenses are expected to be paid 71% in the month in which they are incurred, with the balance to be paid in the following month. Prepare a schedule indicating cash payments for selling and administrative expenses for March, April, and May. Enter all amounts as positive numbers. 4 0 GROW INC. Schedule of Cash Payments for Selling and Administrative Expenses For the Three Months Ending May 31 Line Item Description March March expenses: Paid in…
3. The Uthred Company, a merchandising firm, has planned the following sales for the next four months: March $50,000 Аpril $70,000 Мay $90,000 June July $90,000 Total budgeted Sales $60,000 Sales are made 60% on account and 40% cash. From experience, the company has learned that a month's sales on account are collected according to the following pattern: Month of sale 60% • First month following month of sale . • Second month following month of sale • Uncollectible 28% 10% 2% Uthred has a building that is not used in the business operation; they rented it out and receive $10,080 rent every month. The company requires a minimum cash balance of $14,000 to start a month.
ABC Company seeks your assistance in developing cash and other budget information for August, September,and October, 201A. On July 31, 201A, the company had cash of P22,000, accounts receivable of P874,000,inventories of P618,800, and accounts payable of P266,110.The budget is based on the following assumptions:a. Sales1. Sixty percent (60%) of the billings are collected within the month of sale, 25% are collected in the firstmonth after the month of sale, 10% are collected in the second month after the month of sale, and5% are proved uncollectible.b. Purchases1. Sixty-five percent (65%) of all purchases of materials and selling and administrative expenses are paidin the month purchased and the remainder in the following month.2. Each month’s units of ending inventory are equal to 120% of the next month’s units of sales.3. The cost of each unit of inventory is P20.00.4. Selling and administrative expenses are equal to 20% of the current month’s sales.Actual and projected sales are as…