Concept explainers
Preparing the financial budget—budgeted
Learning Objective 4 FG inventory $3,150 |
Barker, Inc. has the following balance sheet at December 31, 2018:
BARKER, INC.Balance SheetDecember 31, 2018 | ||
Assets | ||
Current Assets | ||
Cash | $2,400 | |
1,400 | ||
Raw Materials Inventory | 500 | |
Finished Goods Inventory | 1,350 | |
Total Current Assets | $5,650 | |
Property, Plant, and Equipment: | ||
Equipment | 16,000 | |
Less: |
(1,500) | 14,500 |
Total Assets | $20,150 | |
Liabilities | ||
Current Liabilities: | ||
Accounts Payable | $1,000 | |
Common Stock, no par | $6,500 | |
12,650 | ||
Total Stockholders’ Equity | 19,150 | |
Total Liabilities and Stockholders’ Equity | $20,150 |
Barker projects the following transactions for 2019:
Sales on account, $20,000.
Cash receipts from customers from sales on account, $17,600
Purchase of raw materials on account, $7,000
Payments on account, $3,500
Total cost of completed products, $16,600, which includes the following:
Raw materials used, $7,100
Direct labor costs incurred and paid, $3,900
Depreciation on manufacturing equipment, $800
Cost of goods sold, $14,800
Selling and administrative costs incurred and paid, $500
Purchase of equipment, paid in 2019, $2,000
Prepare a budgeted balance sheet for Barker. Inc. for December 31, 2019.
(Hint: It may be helpful to trace the effects of each transaction on the
Want to see the full answer?
Check out a sample textbook solutionChapter 22 Solutions
Horngren's Accounting (12th Edition)
- Required information Skip to question [The following information applies to the questions displayed below.] Endless Mountain Company manufactures a single product that is popular with outdoor recreation enthusiasts. The company sells its product to retailers throughout the northeastern quadrant of the United States. It is in the process of creating a master budget for 2022 and reports a balance sheet at December 31, 2021 as follows: Endless Mountain Company Balance Sheet December 31, 2021 Assets Current assets: Cash $ 46,200 Accounts receivable (net) 260,000 Raw materials inventory (4,500 yards) 11,250 Finished goods inventory (1,500 units) 32,250 Total current assets $ 349,700 Plant and equipment: Buildings and equipment 900,000 Accumulated depreciation (292,000 ) Plant and equipment, net 608,000 Total assets $ 957,700 Liabilities and…arrow_forwardLearning Objective 5 Sales Manufacturing costs Selling and administrative expenses Capital expenditures The company expects to sell about 10 % of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month following the sale and the remainder the following month (second month following sale). Depreciation, insurance, and property tax expense represent $9,000 of the estimated monthly manufacturing costs. The annual insurance premium is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, 80% are expected to be paid in the month in which they are incurred and the balance in the following month. Current assets as of September 1 include cash of $48,000, marketable securities of $68,000, and accounts receivable of $139,000 ($30,000 from July sales and $109,000 from August sales). Sales on account for July and August were $100,000 and $109,000, respectively. Current liabilities as of September 1…arrow_forwardequired information Skip to question [The following information applies to the questions displayed below.] Endless Mountain Company manufactures a single product that is popular with outdoor recreation enthusiasts. The company sells its product to retailers throughout the northeastern quadrant of the United States. It is in the process of creating a master budget for 2022 and reports a balance sheet at December 31, 2021 as follows: Endless Mountain Company Balance Sheet December 31, 2021 Assets Current assets: Cash $ 46,200 Accounts receivable (net) 260,000 Raw materials inventory (4,500 yards) 11,250 Finished goods inventory (1,500 units) 32,250 Total current assets $ 349,700 Plant and equipment: Buildings and equipment 900,000 Accumulated depreciation (292,000 ) Plant and equipment, net 608,000 Total assets $ 957,700 Liabilities and…arrow_forward
- Required Information TES-417 Inc. is a retailer. Its accountants are preparing the company's 2nd quarter master budget. The company has the following balance sheet as of March 31. TES-417 Inc. Balance Sheet March 31 Assets Cash $82,000 Accounts receivable Inventory 52,5ee 217,000 Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable 78,000 Common stock 347.000 55,500 Retained earnings Total liabilities and stockholders' equity TES-417 accountants have made the following estimates: 1. Sales for April, May, June, and July will be $280,000, $300.000, $290,000, and $310,000, respectively. 2. All sales are on credit. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at March 31 will be collected in April. 3. Each month's ending inventory must equal 25% of next month's cost of goods sold. The cost of goods sold is 75% of sales. The company pays for 40%…arrow_forwardRequired Information TES-417 Inc. is a retailer. Its accountants are preparing the company's 2nd quarter master budget. The company has the following balance sheet as of March 31. TES-417 Inc. Balance Sheet March 31 Assets Cash $ 82,000 Accounts receivable Inventory 129,000 52,500 Plant and equipment, net of depreciation 217,000 Total assets $ 480,500 Liabilities and Stockholders' Equity Accounts payable $ 78,000 Common stock 347,000 Retained earnings Total liabilities and stockholders' equity TES-417 accountants have made the following estimates: 1. Sales for April, May, June, and July will be $280,000, $300,000, $290,000, and $310,000, respectively. 2. All sales are on credit. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at March 31 will be collected in April. 3. Each month's ending inventory must equal 25% of next month's cost of goods sold. The cost of goods sold is 75% of sales. The company…arrow_forwardRequired Information TES-417 Inc. is a retailer. Its accountants are preparing the company's 2nd quarter master budget. The company has the following balance sheet as of March 31. TES-417 Inc. Balance Sheet March 31 Assets Cash Accounts receivable 129,808 Inventory 52,508 217,000 Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity ps payable 347,808 Retained earnings Total liabilities and stockholders' equity 488,508 TES-417 accountants have made the following estimates: 1. Sales for April, May, June, and July will be $280,000, $300,000, $290,000, and $310,000, respectively. 2. All sales are on credit. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at March 31 will be collected in April. 3. Each month's ending inventory must equal 25% of next month's cost of goods sold. The cost of goods sold is 75% of sales. The company pays for 40% of its merchandise…arrow_forward
- Required Information TES-417 Inc. is a retailer. Its accountants are preparing the company's 2nd quarter master budget. The company has the following balance sheet as of March 31. TES-417 Inc. Balance Sheet March 31 Assets Cash $ 82,000 Accounts receivable Inventory 52,500 Plant and equipment, net of depreciation 217,880 Total assets $ 488.500 Liabilities and Stockholders' Equity Accounts payable $ 78,000 Common stock 347,880 55,580 Retained earnings Total liabilities and stockholders' equity $ 480,500 TES-417 accountants have made the following estimates: 1. Sales for April, May, June, and July will be $280,000, $300,000, $290,000, and $310,000, respectively. 2. All sales are on credit. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at March 31 will be collected in April. 3. Each month's ending inventory must equal 25% of next month's cost of goods sold. The cost of goods sold is 75% of sales.…arrow_forwardRequired Information TES-417 Inc. is a retaller. Its accountants are preparing the company's 2nd quarter master budget. The company has the following balance sheet as of March 31. TES-417 Inc. Balance Sheet March 31 Assets Accounts receivable Inventory 129,880 52, see 217,000 Plant and equipment, net of depreciation. Total assets $ 480.500 Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings 55, see Total liabilities and stockholders' equity $ 480.500 TES-417 accountants have made the following estimates: 1. Sales for April, May, June, and July will be $280,000, $300,000, $290,000, and $310,000, respectively. 2. All sales are on credit. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at March 31 will be collected in April. 3. Each month's ending inventory must equal 25% of next month's cost of goods sold. The cost of goods sold is 75% of sales. The company pays for…arrow_forwardPreparing an operating budget Clipboard Office Supply's March 31, 2020, balance sheet follows: CLIPBOARD OFFICE SUPPLY Balance Sheet March 31, 2020 Assets Current Assets: Cash $ 28,000 Accounts Receivable 11,500 Merchandise Inventory 15,000 Prepaid Insurance 1,000 Total Current Assets $ 55,500 Property, Plant, and Equipment: Equipment and Fixtures 55,000 Less: Accumulated Depreciation (20,000) 35,000 Total Assets $ 90,500 Liabilities Current Liabilities: Accounts Payable $ 10,500 Salaries and Commissions Payable 1,200 Total Liabilities $ 11,700 Stockholders' Equity Common Stock 25,000 Retained Earnings 53,800 Total Stockholders' Equity 78,800 Total Liabilities and Stockholders' Equity $ 90,500arrow_forward
- Required information Skip to question [The following information applies to the questions displayed below.] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below: Beech Corporation Balance Sheet June 30 Assets Cash $ 76,000 Accounts receivable 137,000 Inventory 86,100 Plant and equipment, net of depreciation 230,000 Total assets $ 529,100 Liabilities and Stockholders’ Equity Accounts payable $91,000 Common stock 312,000 Retained earnings 126,100 Total liabilities and stockholders’ equity $ 529,100 Beech’s managers have made the following additional assumptions and estimates: Estimated sales for July, August, September, and October will be $410,000, $430,000, $420,000, and $440,000, respectively. All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 35% in the…arrow_forwardeBook Print Item Question Content Area Relevant data from the Poster Company’s operating budgets are: Quarter 1 Quarter 2 Sales $208,470 $211,539 Direct material purchases 115,290 120,831 Direct labor 75,200 73,300 Manufacturing overhead 25,400 25,200 Selling and administrative expenses 33,400 33,400 Depreciation included in selling and administrative 1,500 1,100 Collections from customers 215,392 240,154 Cash payments for purchases 114,300 119,252 Additional data:Capital assets were sold in January for $11,000 and $4,500 in May.Dividends of $4,600 were paid in February. The beginning cash balance was $60,360 and a required minimum cash balance is $58,000. Use this information to prepare a cash budget for the first two quarters of the year: If an amount box does not require an entry, leave it blank. The Poster CompanyCash BudgetFor the First Two Quarters Quarter 1 Quarter 2 $- Select - $- Select - Add: Cash Receipts - Select - -…arrow_forwardPrepare Hilton goods sold computations. 2. Prepare a combined cash budget similar to exhibits in the chapter. If no financing ac- P9-61A Cash budgets (Learning Objective 3) and cash disbursements: are as follows: Budgeted Sales Revenue $62,000 January $70,000 February. b. Actual purchases of direct materials in December were $24,500. The companye purchases of direct materials in January are budgeted to be $24,000 and $26.000 i February. All purchases are paid 40% in the month of purchase and 60% the follow month. c. Salaries and sales commissions are also paid half in the month earned and half the next month. Actual salaries were $8,000 in December. Budgeted salaries in Janu- ary are $9,000 and February budgeted salaries are $10,500. Sales commissions each month are 8% of that month's sales. d. Rent expense is $3,500 per month. e. Depreciation is $2,100 per month. f. Estimated income tax payments are made at the end of January. The estimated tax payment is projected to be $12,500. g.…arrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education