Question

In: Accounting

Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...

Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10]

Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below:

Minden Company
Balance Sheet
April 30
Assets
Cash $ 10,000
Accounts receivable 62,750
Inventory 32,750
Buildings and equipment, net of depreciation 219,000
Total assets $ 324,500
Liabilities and Stockholders’ Equity
Accounts payable $ 69,000
Note payable 22,700
Common stock 180,000
Retained earnings 52,800
Total liabilities and stockholders’ equity $ 324,500

The company is in the process of preparing a budget for May and has assembled the following data:

  1. Sales are budgeted at $254,000 for May. Of these sales, $76,200 will be for cash; the remainder will be credit sales. One-half of a month’s credit sales are collected in the month the sales are made, and the remainder is collected in the following month. All of the April 30 accounts receivable will be collected in May.

  2. Purchases of inventory are expected to total $137,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May.

  3. The May 31 inventory balance is budgeted at $45,000.

  4. Selling and administrative expenses for May are budgeted at $98,400, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $5,550 for the month.

  5. The note payable on the April 30 balance sheet will be paid during May, with $350 in interest. (All of the interest relates to May.)

  6. New refrigerating equipment costing $8,700 will be purchased for cash during May.

  7. During May, the company will borrow $27,400 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year.

Required:

1. Calculate the expected cash collections from customers for May.

2. Calculate the expected cash disbursements for merchandise purchases for May.

3. Prepare a cash budget for May.

4. Prepare a budgeted income statement for May.

5. Prepare a budgeted balance sheet as of May 31.

Solutions

Expert Solution


Related Solutions

Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 12,000 Accounts receivable 77,500 Inventory 42,000 Buildings and equipment, net of depreciation 225,000 Total assets $ 356,500 Liabilities and Stockholders’ Equity Accounts payable $ 78,250 Note payable 19,300 Common stock 180,000 Retained earnings 78,950 Total liabilities and...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 12,000 Accounts receivable 77,500 Inventory 42,000 Buildings and equipment, net of depreciation 225,000 Total assets $ 356,500 Liabilities and Stockholders’ Equity Accounts payable $ 78,250 Note payable 19,300 Common stock 180,000 Retained earnings 78,950 Total liabilities and...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 9,200 Accounts receivable 76,250 Inventory 49,750 Buildings and equipment, net of depreciation 228,000 Total assets $ 363,200 Liabilities and Stockholders’ Equity Accounts payable $ 63,750 Note payable 23,900 Common stock 180,000 Retained earnings 95,550 Total liabilities and...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 15,000 Accounts receivable 78,000 Inventory 37,750 Buildings and equipment, net of depreciation 232,000 Total assets $ 362,750 Liabilities and Stockholders’ Equity Accounts payable $ 81,500 Note payable 14,000 Common stock 180,000 Retained earnings 87,250 Total liabilities and...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-19 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 16,700 Accounts receivable 75,500 Inventory 37,000 Buildings and equipment, net of depreciation 258,000 Total assets $ 387,200 Liabilities and Stockholders’ Equity Accounts payable $ 86,750 Note payable 15,700 Common stock 180,000 Retained earnings 104,750 Total liabilities and...
Problem 8-19 (REV) Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company...
Problem 8-19 (REV) Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 11,100 Accounts receivable 72,500 Inventory 37,500 Buildings and equipment, net of depreciation 238,000 Total assets $ 359,100 Liabilities and Stockholders’ Equity Accounts payable $ 68,000 Note payable 19,400 Common stock 180,000 Retained earnings 91,700 Total liabilities...
Problem 8-17 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-17 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 9,000 Accounts receivable 54,000 Inventory 30,000 Buildings and equipment, net of depreciation 207,000 Total assets $ 300,000 Liabilities and Stockholders’ Equity Accounts payable $ 63,000 Note payable 14,500 Common stock 180,000 Retained earnings 42,500 Total liabilities and...
Problem 8-17 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is...
Problem 8-17 Cash Budget; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 9,000 Accounts receivable 54,000 Inventory 30,000 Buildings and equipment, net of depreciation 207,000 Total assets $ 300,000 Liabilities and Stockholders’ Equity Accounts payable $ 63,000 Note payable 14,500 Common stock 180,000 Retained earnings 42,500 Total liabilities and...
Problem 8-20 Cash Budget; Income Statement; Balance Sheet; Changing Assumptions [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden...
Problem 8-20 Cash Budget; Income Statement; Balance Sheet; Changing Assumptions [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 9,000 Accounts receivable 54,000 Inventory 30,000 Buildings and equipment, net of depreciation 207,000 Total assets $ 300,000 Liabilities and Stockholders’ Equity Accounts payable $ 63,000 Note payable 14,500 Common stock 180,000 Retained earnings 42,500 Total...
Problem 7-17A Cash Budget; Income Statement; Balance Sheet [LO7-2, LO7-4, LO7-8, LO7-9, LO7-10] Minden Company is...
Problem 7-17A Cash Budget; Income Statement; Balance Sheet [LO7-2, LO7-4, LO7-8, LO7-9, LO7-10] Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 11,400 Accounts receivable 75,000 Inventory 41,000 Buildings and equipment, net of depreciation 224,000 Total assets $ 351,400 Liabilities and Stockholders’ Equity Accounts payable $ 70,000 Note payable 15,500 Common stock 180,000 Retained earnings 85,900 Total liabilities and...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT