Question

Deacon Company is a merchandising company that is preparing a budget for the three-month period ended June 30th. The following information is available

Deacon Company Balance Sheet March 31
Assets
Cash	$	60,200
Accounts receivable		30,800
Inventory		60,400
Buildings and equipment, net of depreciation		124,000
Total assets	$	275,400
Liabilities and Stockholders’ Equity
Accounts payable	$	71,100
Common stock		70,000
Retained earnings		134,300
Total liabilities and stockholders’ equity	$	275,400

Budgeted Income Statements
	April			May			June
Sales	$	168,000		$	178,000		$	198,000
Cost of goods sold		(100,800)			(106,800)			(118,800)
Gross margin		67,200			71,200			79,200
Selling and administrative expenses		(22,400)			(23,900)			(26,900)
Net operating income	$	44,800		$	47,300		$	52,300

Budgeting Assumptions:

A) 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80% are collected in the month subsequent to the sale.

B) Budgeted sales for July are $208,000.

C) 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase.

D) Each month’s ending merchandise inventory should equal $10,000 plus 50% of the next month’s cost of goods sold.

E) Depreciation expense is $1,100 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred.

Required:

-ONLY ANSWER #4

1. Calculate the expected cash collections for April, May, and June.

-April = $145,040 May = $174,800 June = $191,600 Quarter $511,440

2. Calculate the budgeted merchandise purchases for April, May, and June.

-April=$103,800 May=$112,800 June=$121,800 Total=$338,400

3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June.

-April=$81,480 May=$104,700 June=$113,700 Quarter=$299,880

4. Prepare a budgeted balance sheet at June 30th. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30th balance sheet.)

Answer 1

If it's not too much trouble hit LIKE catch if this made a difference. For any further clarification, it would be ideal if you put your inquiry in remark, will hit you up.
2. Purchase of Merchandise Budget:
		Apr	May	Jun
Cost of Goods Sold		$           100,800	$           106,800	$           118,800
Add: Desired Ending Inventory	10000+50% of Next Month COGS	$             63,400	$             69,400	$             52,000
Need		$           164,200	$           176,200	$           170,800
Less: Beginning Inventory		$            -60,400	$            -63,400	$            -69,400
Total Cost of Purchases		$ (164,200-60,400)= $103,800	$(176,200-63,400)= $112,800	$(170,800-69,400)= $ 101,400
1. Expected Cash Collections
Same Month	20%
Next Month	80%
	Total Sale	Apr	May	Jun	Jun 30 Receivable
Accounts Receivable - January 1	$                                                                30,800	$             30,800
Credit sales from:
April	$                                                                67,200	$             13,440	$             53,760		$                             -
May	$                                                                71,200		$             14,240	$             56,960	$                             -
June	$                                                                79,200			$             15,840	$                    63,360
Total Collection of Receivables	$                                                              248,400	$(30,800+13,440) =$ 44,240	$(53,760+14,240)= $68,000	$(56,960+15,840)= $72,800	$                    63,360
Total Cash Receipt from customers:		Apr	May	Jun	Total
Current Month Cash Sales	60%	$           100,800	$           106,800	$           118,800	$                 326,400
Total Collection of Receivables		$             44,240	$             68,000	$             72,800	$                 185,040
		$           145,040	$           174,800	$           191,600	$                 511,440
3. Payment for Merchandise:
Same	10%
Next	90%
	Total	Apr	May	Jun	Jun 30 Payable
Accounts Payable-January 1	$                                                                71,100	$             71,100
Marchandise Purchased in
April	$                                                              103,800	$             10,380	$             93,420		$                             -
May	$                                                              112,800		$             11,280	$           101,520	$                             -
June	$                                                              101,400			$             10,140	$                    91,260
Total Cash paid for merchandise	$                                                              389,100	$             81,480	$           104,700	$           111,660	$                    91,260
Selling Administartive Expense Budget:
		Apr	May	Jun	Total
Selling and Administrative Expenses		$             22,400	$             23,900	$             26,900	$                    73,200
Less Non Cash-Depreciation		$                1,100	$                1,100	$                1,100	$                      3,300
Cash Disbursment for selling and Admin		$             21,300	$             22,800	$             25,800	$                    69,900
Cash Budget:
		Apr	May	Jun	Jun 30 Payable
Beginning Cash Balance		$             60,200	$           102,460	$           149,760	$                    60,200
Cash Receipts from Customers		$           145,040	$           174,800	$           191,600	$                 511,440
Total Cash Available		$           205,240	$           277,260	$           341,360	$                 571,640
Cash Payment for:
Merchandise		$             81,480	$           104,700	$           111,660	$                 297,840
Selling and Admin Expense		$             21,300	$             22,800	$             25,800	$                    69,900
Total Cash Payments		$           102,780	$           127,500	$           137,460	$                 367,740
Ending Cash Balance		$           102,460	$           149,760	$           203,900	$                 203,900
9. Budgeted Balance Sheet:
Assets:
Cash		$ 203,900
Accounts Receiviable		$ 63,360
Merchandise Inventory		$ 52,000
Total Current Assets			$ 319,260
Building and Equipment, Net	124000-3300	$ 120,700
Equipment, Net			$ 120,700
Total Assets			$ 439,960
Liabilities and Equity
Liabilities:
Accounts Payable		$ 91,260
Total Liabilities			$ 91,260
Stockholder Equity
Common Stock		$ 70,000
Retained Earning		$ 278,700
Total Stockholder Equity			$ 348,700
Total Liabilities & Equity			$           439,960	$                       -