Question

Use the following information to prepare a budgeted balance sheet for

Olivas Corporation at March 31. Show computations for the cash and​ stockholders' equity amounts.

a.	March 31 inventory​ balance, $16,370.
b.	March payments for​ inventory, $4,500.
c.	March payments of accounts payable and accrued​ liabilities, $8,400.
d.	March 31 accounts payable​ balance, $1,700.
e.	February 28 furniture and fixtures​ balance, $34,700​; accumulated depreciation​ balance, $29,830.
f.	February 28​ stockholders' equity, $28,000.
g.	March depreciation​ expense, $400.
h.	Cost of goods​ sold, 40% of sales.
i.	Other March​ expenses, including income​ tax, total $8,000​; paid in cash.
j.	February 28 cash​ balance, $11,500.
k.	March budgeted​ sales, $12,400.
l.	March 31 accounts receivable​ balance, one-fourth of March sales.
m.	March cash​ receipts, $14,200.

Answer 1

Olivas Corporation
Balance Sheet as at March 31
Liabilities	Amount	Assets	Amount
Equity	28,000	Furniture and Fixtures	4,470
Profit and Loss account	-960	Account Receivables (1/4 of sales = 12400/4)	3,100
Account Payables	1,700	Inventory	16,370
		Cash	4,800
Total	28,740	Total	28,740	-
Working Notes:
Profit and loss account
Particulars	Amount
Sales	12,400
COGS (40% of 12400)	-4,960
Depreciation	-400
Exp	-8,000
Loss incurred	-960
Furniture and Fixtures A/c
Particulars	Cost	Acc. Dep	Net
Feb 28 Balance	34,700	29,830
Depreciation		400
Mar-31	34,700	30,230	4,470
Cash A/c
Particulars	Amount
Feb 28 Balance	11,500
Add: Receipt	14,200
Less: expenses payment	-8,000
Less: Inventory payment	-4,500
Less: Account payment and other	-8,400
March 31 Balance	4,800