Question

The following information for December is available for Barclay Corporation, whose only manufacturing cost is Direct Material (D/M) and maintains no Finished Good Inventory:

Actual Balance Sheet as of December 1 (end of November)
Cash	$ 42,700	D/M Accounts Payable	$ 21,700
Accounts Receivable	20,000	Owners’ Equity (Stock and Retained Earnings)	198,000
D/M Inventory	31,000
Net Plant & Equip	126,000
	$219,700		$219,700

December Budget Information:

• Sales (all on credit) $72,000
• D/M Purchases (all on credit) $45,000
• Cash Receipts from Sales $63,200 (includes the 12/1 Accounts Receivable)
• Cash Payments for D/M and S&A $47,200 (includes the 12/1 D/M Accounts Payable)
• D/M to be Used in Production $36,000
• Cost of Goods Sold $36,000
• S & A Expenses $14,000 (includes $2,000 of depreciation)

Use the above information to answer the next 6 questions.

What value for Cash would appear on the budgeted Balance Sheet below for the period ending December 31.?

Group of answer choices

$69,900

$16,000

$58,700

$38,700

What value for Accounts Receivable would appear on the budgeted Balance Sheet below for the period ending December 31.?

Group of answer choices

$92,000

$8,800

$72,000

$28,800

What value for D/M Inventory would appear on the budgeted Balance Sheet below for the period ending December 31.?

Group of answer choices

$9,000

$76,000

$45,000

$40,000

What value for Net Plant & Equip would appear on the budgeted Balance Sheet below for the period ending December 31.?

Group of answer choices

$128,000

$126,000

-$2,000

$124,000

What value for D/M Accounts Payable would appear on the budgeted Balance Sheet below for the period ending December 31.?

Group of answer choices

$45,500

$19,500

$31,500

$9,800

What value for Owner's Equity would appear on the budgeted Balance Sheet below for the period ending December 31.?

Group of

answer choices

$222,000

$22,000

$220,000

$222,800

Answer 1

Answer to Question:

The value for Cash would appear on the budgeted Balance Sheet below for the period ending December 31:

$58,700

Particulars	Amount($)
Opening Cash	42700
Add: Cash Receipt from Sales	63200
Less: Cash Payment for DM	(47,200)
Closing Cash	58700

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Answer to Question:

The value for Accounts Receivable would appear on the budgeted Balance Sheet below for the period ending December 31: $28,800

Particulars	Amount($)
Opening Account Receivable	20000
Add: Credit Sales	72000
Less: Cash Receipt from Sales	(63,200)
Closing Account Receivable	28,800

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Answer to Question:

The value for D/M Inventory would appear on the budgeted Balance Sheet below for the period ending December 31: $40,000

Particulars	Amount($)
Opening Inventory	31000
Add: Credit Purchases	45000
Less: Direct Material used in Production	(36,000)
Closing Inventory	40,000

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Answer to Question:

The value for Net Plant & Equip would appear on the budgeted Balance Sheet below for the period ending December 31: $1,24,000

Particulars	Amount($)
Opening Plant & Equipment	1,26,000
Less: Depreciation	(2,000)
Closing Plant & Equipment	1,24,000

........................................................................................................................................................................................Answer to Question:

The value for D/M Accounts Payable would appear on the budgeted Balance Sheet below for the period ending December 31 : $31,500

Particulars	Amount($)
Opening Account Payable	21,700
Add: Credit Purchases	45,000
Less: Cash Payment for DM**	(35,200)
Closing Account Payable	31,500

**($47,200- $12,000) = $35,200

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Answer to Question:

The value for Owner's Equity would appear on the budgeted Balance Sheet below for the period ending December 31: $2,20,000

Particulars	Amount($)
Opening Owners Equity	1,98,000
Add: Net Profit for the year***	22,000
Closing Owners Equity	2,20,000

***

Particulars	Amount($)
Total Sales	72,000
Add: Closing Stock ##	9,000
Less: Purchases	(45,000)
Less: S&A Exenses	(14,000)
Net Profit	22,000

## $45,000- $36,000 = $9,000

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