Question

In: Finance

Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...

Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures:

Actual Forecast Additional Information
November $680,000 January $760,000 April forecast $580,000
December 700,000 February 800,000
March 590,000

Of the firm’s sales, 45 percent are for cash and the remaining 55 percent are on credit. Of credit sales, 40 percent are paid in the month after sale and 60 percent are paid in the second month after the sale. Materials cost 25 percent of sales and are purchased and received each month in an amount sufficient to cover the following month’s expected sales. Materials are paid for in the month after they are received. Labor expense is 50 percent of sales and is paid for in the month of sales. Selling and administrative expense is 15 percent of sales and is paid in the month of sales. Overhead expense is $40,000 in cash per month.

Depreciation expense is $12,400 per month. Taxes of $10,400 will be paid in January, and dividends of $14,000 will be paid in March. Cash at the beginning of January is $128,000, and the minimum desired cash balance is $123,000.

a. Prepare a schedule of monthly cash receipts for January, February, and March.
  


b. Prepare a schedule of monthly cash payments for January, February, and March.
  


c. Prepare a monthly cash budget with borrowings and repayments for January, February, and March. (Negative amounts should be indicated by a minus sign. Assume the January beginning loan balance is $0.)

Solutions

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE


Related Solutions

Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $320,000 January $400,000 April forecast $400,000 December 340,000 February 440,000 March 410,000 Of the firm’s sales, 60 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $620,000 January $700,000 April forecast $550,000 December 640,000 February 740,000 March 560,000 Of the firm’s sales, 30 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $420,000 January $500,000 April forecast $450,000 December 440,000 February 540,000 March 460,000 Of the firm’s sales, 40 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $440,000 January $520,000 April forecast $460,000 December 460,000 February 560,000 March 470,000 Of the firm’s sales, 50 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $540,000 January $620,000 April forecast $510,000 December 560,000 February 660,000 March 520,000 Of the firm’s sales, 30 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $440,000 January $520,000 April forecast $460,000 December 460,000 February 560,000 March 470,000 Of the firm’s sales, 50 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $660,000 January $740,000 April forecast $570,000 December 680,000 February 780,000 March 580,000 Of the firm’s sales, 40 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecasted sales figures: Actual Forecast Additional Information November……. $200,000 January………. $280,000 April Forecast……… $360,000 December……. $262,000 February…….. $320,000 March………... $340,000 Of the firm's sales, 40 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $560,000 January $640,000 April forecast $520,000 December 580,000 February 680,000 March 530,000 Of the firm’s sales, 50 percent are for cash and the...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and...
Harry’s Carryout Stores has eight locations. The firm wishes to expand by two more stores and needs a bank loan to do this. Mr. Wilson, the banker, will finance construction if the firm can present an acceptable three-month financial plan for January through March. The following are actual and forecast sales figures: Actual Forecast Additional Information November $240,000 January $320,000 April forecast $360,000 December 260,000 February 360,000 March 370,000 Of the firm’s sales, 60 percent are for cash and the...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT