Question

In: Accounting

The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially...

The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially completed Master Budget for January and February. Use the information to answer the 22 Multiple Choice Questions, each asking for a missing number from the Master Budget. Round all your computations to the nearest dollar.

  1. Sales are expected to be $80,900 in January, $100,900 in February, and $105,900 in March.
  2. All sales are on credit and it collects 20% of all sales in the month of the sale, the remaining 80% in the month after the sale.
  3. The cost of goods sold is equal to 40% of sales.
  4. The company likes to keep an ending inventory on hand equal to 15% of next month’s cost of goods sold.
  5. All purchases of inventory are on account, and the company pays for 60% of all purchases in the month of the purchase, 40% in the month after the purchase.
  6. The company pays its sales force a commission equal to 3% of sales.
  7. The company also believes that its miscellaneous expense is equal to $500 plus 2% of sales.
  8. Rent is $2,000 per month, Supplies are $600 per month, and Depreciation is $1,800 per month.
  9. On January 1st, the company purchased an insurance policy covering 24 months for $28,800.
  10. All selling and administrative expenses are paid in the month they are incurred except for commissions that are paid in the month after they are earned and the insurance which is paid two year in advance.
  11. The company purchased $4,000 of Land on February 18th. They paid cash for the land.
  12. Interest on long-term debt is equal to 1% of the beginning balance and is paid each month. The company must maintain a minimum balance in cash of $15,000 and will use any cash surplus to pay down long-term debt. The company borrows cash in $1,000 increments.
  13. The company is subject to a 30% income tax rate. The company pays income taxes in the month after they are accrued (expensed).
  14. The company’s Board of Directors declared a cash dividend of $950 on January 4th. The dividend will be paid on February 10th.
  15. The company had a beginning balance sheet (as of January 1) as follows:
Assets Liabilities & SE
Current Assets Current Liabilities
Cash $16,000 Accounts Payable $23,500
Accounts Receivable 48,000 Commissions Payable 3,400
Prepaid Insurance 0 Income Taxes Payable 9,275
Inventory 9,600 Dividends Payable 0
Total Current Assets 73,600 Total Current Liabilities 36,175
Long-term Debt 80,000
Property, Plant & Equipment
Equipment 95,000 Stockholders Equity
Land 8,800 Common Stock 26,225
Accumulated Depreciation (25,000) Return Earnings 10,000
Net PPE 78,800 Total SE 36,225
Total Assets $152,400 Total Liabilities & SE $152,400

Babcats Company's partically completed master budget is as follows:

Sales Budget

January February March
Credit Sales $80,900 $100,900 $105,900
Cash Receipts from Customers
From Current Month Credit Sales
From Prior Month Credit Sales      
Total Cash Receipts from Customers (1)

Inventory Purchases Budget

January February March
COGS $40,360 $42,360
Desired Ending Inventory
Total INventory Needed
Beginning Inventory
Inventory Purchases (2)
Cash Payments for Inventory Purchases
For Current Month Purchases
For Prior Month Purchases
Total Cash Payments for Inventory Purchases $40,788 (3)

Selling & Administrative Expenses Budget

January February
Variable Selling & Administrative Expenses
Commissions (4)
Miscellaneous
Total Variable S&A Expenses 4,045 5,045
Fixed Selling & Administrative Expenses
Miscellaneous
Rent 2,000 2,000
Supplies
Depreciation 1,800 1,800
Insurance (5)
Total Fixed S&A Expenses $6,100 $6,100
Cash Payments for S&A Expenses
Commissions
Utilities
Advertising
Salaries
Depreciation (6)
Insurance (7)
Total Cash Payments for S&A Expenses $36,918 $7,545

Cash Budget

January February
Beginning Cash Balance
Cash Receipts from Customers
Total Cash Available 80,180
Cash Payments
For Inventory Purchases 40,788
For S&A Expenses
For Interest (8)
For Income Taxes
For Land Purchase
For Dividends
Total Cash Payments 87,781
Surplus (Deficit) (9) 39,574
Borrowing (Repayment) (10)
Ending Cash Balance $ 15,000

Income Statement

January February
Sales $80,900 $100,900
Less: Variable Expenses
COGS
Variable S&A Expenses
Contrinbution Margin (11)
Less: Fixed Expenses
Fixed S&A Expenses
Interest Expense
Pre-tax Net Income
Income Taxes Expense 11,279 14,510
After-tax Net Income $26,317 $33,856

Balance Sheet

Assets Liabilities & SE
Current Assets Current Liabilities
Cash (12) Accounts Payable (18)
Accounts Receivable (13) Commissions Payable (19)
Prepaid Insurance (14) Income Taxes Payable
Inventory (15) Dividends Payable (20)
Total Current Assets Total Current Liabilities
Long-term Debt (21)
Property, Plant & Equipment
Equipment 95,000 95,000 Stockholders Equity
Land (16) Common Stock 26,225 26,225
Accumulated Depreciation (17) Return Earnings (22)
Net PPE Total SE
Total Assets $190,773 $207,674 Total Liabilities & SE $190,773 $207,674

(10) What is Total Net Borrowing (Repayment) for February?

multiple choice 10

  • $-39,574

  • $24,574

  • $23,000

  • $-24,574

(11) What is the Contribution Margin for February?

multiple choice 11

  • $44,495

  • $100,900

  • $33,856

  • $55,495

(12) What is the balance of Cash on February 28?

multiple choice 12

  • $15,000

  • $16,000

  • $0

  • $15,399

(13) What is the balance of Accounts Receivable on February 28?

multiple choice 13

  • $64,720

  • $84,720

  • $48,000

  • $80,720

(14) What is the balance of Prepaid Insurance on January 31?

multiple choice 14

  • $27,600

  • $26,400

  • $28,800

  • $0

(15) What is the balance of Inventory on February 28?

multiple choice 15

  • $6,354

  • $6,054

  • $40,660

  • $9,600

(16) What is the balance of Land on February 28?

multiple choice 16

  • $8,800

  • $0

  • $12,800

  • $4,000

2nd part !!!!

Solutions

Expert Solution


Related Solutions

The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially...
The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially completed Master Budget for January and February. Use the information to answer the 22 Multiple Choice Questions, each asking for a missing number from the Master Budget. Round all your computations to the nearest dollar. Sales are expected to be $80,900 in January, $100,900 in February, and $105,900 in March. All sales are on credit and it collects 20% of all sales in the...
The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially...
The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially completed Master Budget for January and February. Use the information to answer the 22 Multiple Choice Questions, each asking for a missing number from the Master Budget. Round all your computations to the nearest dollar. Sales are expected to be $80,900 in January, $100,900 in February, and $105,900 in March. All sales are on credit and it collects 20% of all sales in the...
The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially...
The information given below is Bobcats Company’s beginning balance sheet, estimates and policies, and the partially completed Master Budget for January and February. Use the information to answer the 22 Multiple Choice Questions, each asking for a missing number from the Master Budget. Round all your computations to the nearest dollar. Sales are expected to be $80,900 in January, $100,900 in February, and $105,900 in March. All sales are on credit and it collects 20% of all sales in the...
The partially complete 2012 balance sheet and income statement for Challenge Industries are given below, followed...
The partially complete 2012 balance sheet and income statement for Challenge Industries are given below, followed by selected ratio values for the firm based on its completed 2012 financial statements. Use the ratios along with the partial statements to complete the financial statements. Hint: Use the ratios in the order listed to calculate the missing statement values that need to be installed in the partial statements. Challenge Industries, Inc. Balance Sheet At December 31, 2012 (in $ thousands) Assets Liabilities...
Beginning balances of FRS Company’s accounts as of January 1, 2018 as given below: Beg Balance...
Beginning balances of FRS Company’s accounts as of January 1, 2018 as given below: Beg Balance Account Title Debit Credit Cash 365,800 Accounts Receivable 42,500 Supplies 13,000 Prepaid Insurance 0 Inventory 18,000 Equipment 46,000 Accumulated Depreciation-Equipment 20,000 Accounts Payable 82,500 Salary Payable 16,000 Unearned Sales Revenue 25,000 Capital 341,800 Withdrawals 0 Sales Revenue Sales Returns& Allowances Sales Discounts Cost of Goods Sold Insurance Expense Depreciation Expense-Equipment Supplies Expense Salary Expense Total 485,300 485,300 During January 2018, FRS Company completed the...
Information from the Balance Sheet and statement of income are given below for Martinez Inc., a...
Information from the Balance Sheet and statement of income are given below for Martinez Inc., a private company reporting under ASPE, for the year ended December 31. Martinez Inc. Comparative Balance Sheet, at December 31 2017 2016 Cash                                                                                 $92,150                $46,150 Accounts receivable 90,700                  36,150 Inventory                                                                           122,000                102,550 Investments in land 85,100                  107,150 Property, plant, and equipment 285,200                201,000 Accumulated depreciation (48,260)               (40,000)                                                                                         $626,890             $454,000 Accounts payable                                                             52,700                   48,410 Accrued liabilities                                                            ...
A condensed balance sheet for Simultech Corporation and a partially completed vertical analysis are presented below....
A condensed balance sheet for Simultech Corporation and a partially completed vertical analysis are presented below. Required: 1. Complete the vertical analysis by computing each missing line item as a percentage of total assets. 2-a. What percentage of Simultech’s total assets relate to inventory? 2-b. What percentage of Simultech’s total assets relate to property and equipment? 2-c. Which of these two asset groups is more significant to Simultech’s business? 3. What percentage of Simultech’s assets is financed by total stockholders'...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current assets: Cash and cash equivalents $ 31,000 $ 28,000 Accounts receivable 18,000 20,000 Inventory 58,000 56,000 Prepaid expenses 12,000 10,000 Total current assets 119,000 114,000 Property, plant, and equipment 374,000 354,000 Less accumulated depreciation 190,000 165,000 Net property, plant, and equipment 184,000 189,000 Total assets $ 303,000 $ 303,000 Liabilities and stockholders' equity: Current liabilities: Accounts payable $ 13,000 $ 9,000 Accrued liabilities 52,000...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current assets: Cash and cash equivalents $ 32,000 $ 25,800 Accounts receivable 18,500 21,000 Inventory 60,000 57,500 Prepaid expenses 12,200 10,100 Total current assets 122,700 114,400 Property, plant, and equipment 386,000 366,000 Less accumulated depreciation 193,000 164,700 Net property, plant, and equipment 193,000 201,300 Total assets $ 315,700 $ 315,700 Liabilities and stockholders' equity: Current liabilities: Accounts payable $ 14,700 $ 10,000 Accrued liabilities 53,000...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current assets: Cash and cash equivalents $ 33,000 $ 26,300 Accounts receivable 19,000 22,000 Inventory 62,000 59,000 Prepaid expenses 12,400 10,200 Total current assets 126,400 117,500 Property, plant, and equipment 398,000 378,000 Less accumulated depreciation 199,000 170,100 Net property, plant, and equipment 199,000 207,900 Total assets $ 325,400 $ 325,400 Liabilities and stockholders' equity: Current liabilities: Accounts payable $ 16,200 $ 11,000 Accrued liabilities 54,000...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT