Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-9, LO8-10] [The following information applies to the questions displayed below.] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below: Beech Corporation Balance Sheet June 30 Assets Cash $ 95,000 Accounts receivable 142,000 Inventory 54,000 Plant and equipment, net of depreciation 225,000 Total assets $ 516,000 Liabilities and Stockholders’ Equity Accounts payable $ 86,000 Common stock 332,000 Retained earnings 98,000 Total liabilities and stockholders’ equity $ 516,000 Exercise 8-13 Beech’s managers have made the following additional assumptions and estimates: Estimated sales for July, August, September, and October will be $360,000, $380,000, $370,000, and $390,000, respectively. All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 45% in the month of sale and 55% in the month following the sale. All of the accounts receivable at June 30 will be collected in July. Each month’s ending inventory must equal 15% of the cost of next month’s sales. The cost of goods sold is 60% of sales. The company pays for 30% of its merchandise purchases in the month of the purchase and the remaining 70% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. Monthly selling and administrative expenses are always $48,000. Each month $7,000 of this total amount is depreciation expense and the remaining $41,000 relates to expenses that are paid in the month they are incurred. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. Required: 1. Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30. 2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. 2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter ended September 30. 3. Prepare an income statement for the quarter ended September 30. 4. Prepare a balance sheet as of September 30.
In: Accounting
| [The following information applies to the questions displayed below.] |
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Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below: |
| Beech Corporation Balance Sheet June 30 |
|
| Assets | |
| Cash | $ 73,000 |
| Accounts receivable | 125,000 |
| Inventory | 56,000 |
| Plant and equipment, net of depreciation | 221,000 |
| Total assets | $ 475,000 |
| Liabilities and Stockholders’ Equity | |
| Accounts payable | $ 82,000 |
| Common stock | 309,000 |
| Retained earnings | 84,000 |
| Total liabilities and stockholders’ equity | $ 475,000 |
rev: 05_02_2017_QC_CS-88254
3.
value:
10.00 points
Required information
| Beech’s managers have made the following additional assumptions and estimates: |
| 1. |
Estimated sales for July, August, September, and October will be $320,000, $340,000, $330,000, and $350,000, respectively. |
| 2. |
All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July. |
| 3. |
Each month’s ending inventory must equal 25% of the cost of next month’s sales. The cost of goods sold is 70% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. |
| 4. |
Monthly selling and administrative expenses are always $40,000. Each month $6,000 of this total amount is depreciation expense and the remaining $34,000 relates to expenses that are paid in the month they are incurred. |
| 5. |
The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. |
| Required: |
| 1. |
Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30. |
| 2-a. |
Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. |
| 2-b. |
Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter ended September 30. |
| 3. |
Prepare an income statement that computes net operating income for the quarter ended September 30. |
| 4. |
Prepare a balance sheet as of September 30. |
In: Accounting
Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO7-2, LO7-4, LO7-9, LO7-10]
| [The following information applies to the questions displayed below.] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below:
Exercise 7-12
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In: Accounting
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Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below: |
|
Beech Corporation Balance Sheet June 30 |
|
| Assets | |
| Cash | $ 92,000 |
| Accounts receivable | 130,000 |
| Inventory | 48,600 |
| Plant and equipment, net of depreciation | 216,000 |
| Total assets | $ 486,600 |
| Liabilities and Stockholders’ Equity | |
| Accounts payable | $ 77,000 |
| Common stock | 329,000 |
| Retained earnings | 80,600 |
| Total liabilities and stockholders’ equity | $ 486,600 |
rev: 09_17_2014_QC_54310
2.
value:
1.00 points
Required information
| Beech’s managers have made the following additional assumptions and estimates: |
| 1. |
Estimated sales for July, August, September, and October will be $270,000, $290,000, $280,000, and $300,000, respectively. |
| 2. |
All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 45% in the month of sale and 55% in the month following the sale. All of the accounts receivable at June 30 will be collected in July. |
| 3. |
Each month’s ending inventory must equal 20% of the cost of next month’s sales. The cost of goods sold is 60% of sales. The company pays for 30% of its merchandise purchases in the month of the purchase and the remaining 70% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. |
| 4. |
Monthly selling and administrative expenses are always $50,000. Each month $5,000 of this total amount is depreciation expense and the remaining $45,000 relates to expenses that are paid in the month they are incurred. |
| 5. |
The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. |
| Required: |
| 1. |
Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30. |
| 2-a. |
Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. |
| 2-b. |
Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter ended September 30. |
| 3. |
Prepare an income statement for the quarter ended September 30. |
| 4. |
Prepare a balance sheet as of September 30. |
Garrison 15e Recheck 2015-01-19, 05_15_2015_QC_CS-15886
In: Accounting
Required information
Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet [LO8-2, LO8-4, LO8-9, LO8-10]
[The following information applies to the questions displayed below.]
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below:
| Beech Corporation | ||
| Balance Sheet | ||
| June 30 | ||
| Assets | ||
| Cash | $ | 90,000 |
| Accounts receivable | 136,000 | |
| Inventory | 62,000 | |
| Plant and equipment, net of depreciation | 210,000 | |
| Total assets | $ | 498,000 |
| Liabilities and Stockholders’ Equity | ||
| Accounts payable | $ | 71,100 |
| Common stock | 327,000 | |
| Retained earnings | 99,900 | |
| Total liabilities and stockholders’ equity | $ | 498,000 |
Exercise 8-12
Beech’s managers have made the following additional assumptions and estimates:
Estimated sales for July, August, September, and October will be $210,000, $230,000, $220,000, and $240,000, respectively.
All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July.
Each month’s ending inventory must equal 30% of the cost of next month’s sales. The cost of goods sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July.
Monthly selling and administrative expenses are always $60,000. Each month $5,000 of this total amount is depreciation expense and the remaining $55,000 relates to expenses that are paid in the month they are incurred.
The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.
Required:
1. Prepare a schedule of expected cash collections for July, August, and September. Also compute total cash collections for the quarter ended September 30.
2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30.
2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also compute total cash disbursements for merchandise purchases for the quarter ended September 30.
3. Prepare an income statement for the quarter ended September 30.
4. Prepare a balance sheet as of September 30.
In: Accounting
On 1 July 2023, Sherlock Ltd leased a processing plant to Holmes Ltd. The plant was purchased by Sherlock Ltd on 1 July 2023 for its fair value of $348 942. The lease agreement contained the following provisions:
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Lease term |
3 years |
|
Economic life of plant |
5 years |
|
Annual rental payment, in arrears (commencing 30/6/24) |
$120 000 |
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Residual value at end of the lease term |
$50 000 |
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Residual guaranteed by lessee |
$30 000 |
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Interest rate implicit in lease |
8% |
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The lease is cancellable only with the permission of the lessor. |
Holmes Ltd intends to return the processing plant to Sherlock Ltd at the end of the lease term. The lease has been classified as a finance lease by Sherlock Ltd.
Required
In: Accounting
| ABC Manufacturing expects to sell 1,025 units of product in 2021 at an average price of $100,000 each based on current demand. | ||||||||||
| The Chief Marketing Officer forecasts growth of 50 units per year through 2025. So, the demand will be 1,025 units in 2021, 1,075 units | ||||||||||
| in 2022, etc. and the $100,000 price will remain consistent for all five years of the investment life. However, ABC cannot produce more | ||||||||||
| than 1,000 units annually based on current capacity. | ||||||||||
| In order to meet demand, ABC must either update the current plant or replace it. If the plant is replaced, an initial working capital investment | ||||||||||
| of $5,000,000 is required and these funds will be released at the end of the investment life to be used elsewhere. | ||||||||||
| The following table summarizes the projected data for both options: | ||||||||||
| Update | Replace | |||||||||
| Initial investment in 2021 | $ 115,000,000 | $ 138,000,000 | ||||||||
| Terminal salvage value in 2025 | $ 10,000,000 | $ - | ||||||||
| Working capital investment required | $ - | $ 5,000,000 | ||||||||
| Useful life | 5 years | 5 years | ||||||||
| Total annual cash operating costs per unit | $ 70,000 | $ 60,000 | ||||||||
Which option is better and why?
In: Accounting
You initiated a transaction to purchase a 3.250% coupon 10-year U.S. Treasury Note on Wednesday 6/7/2017. The maturity date of the note is 9/15/2025 and its yield to maturity is 3.100%. How many days are there in the current coupon period?
| A. |
180 days |
|
| B. |
181 days |
|
| C. |
183 days |
|
| D. |
184 days |
You initiated a transaction to purchase a 3.250% coupon 10-year U.S. Treasury Note on Wednesday 6/7/2017. The maturity date of the note is 9/15/2025 and its yield to maturity is 3.100%. How many days are there between the last coupon and the settlement date?
| A. |
180 days |
|
| B. |
81 days |
|
| C. |
182 days |
|
| D. |
85 days |
You initiated a transaction to purchase a 3.750% semiannual coupon 20-year Corporate Bond on Tuesday Jun 27 , 2017. The maturity date of the bond is 11/15/2032 and its yield to maturity is 3.600%. What is the clean price of the bond on the settlement date in % of PAR?
|
101.750 |
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|
101.756 |
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102.100 |
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|
102.154 |
In: Finance
Suppose the government decides to issue a new savings bond that is guaranteed to double in value if you hold it for 16 years. Assume you purchase a bond that costs $75. a. What is the exact rate of return you would earn if you held the bond for 16 years until it doubled in value? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If you purchased the bond for $75 in 2017 at the then current interest rate of .21 percent year, how much would the bond be worth in 2025? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. In 2025, instead of cashing in the bond for its then current value, you decide to hold the bond until it doubles in face value in 2033. What annual rate of return will you earn over the last 8 years? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
In: Finance
Consider the following time series.
| Quarter | Year 1 | Year 2 | Year 3 |
| 1 | 71 | 68 | 62 |
| 2 | 49 | 41 | 51 |
| 3 | 58 | 60 | 53 |
| 4 | 83 | 85 | 72 |
b. Use the following dummy variables to develop an estimated regression equation to account for seasonal effects in the data: Qtr1 = 1 if Quarter 1, 0 otherwise; Qtr2 = 1 if Quarter 2, 0 otherwise; Qtr3 = 1 if Quarter 3, 0 otherwise. Enter negative values as negative numbers.
Value = + Qtr1 + Qtr2 + Qtr3
c. Compute the quarterly forecasts for next year.
| Quarter 1 forecast | |
| Quarter 2 forecast | |
| Quarter 3 forecast | |
| Quarter 4 forecast |
In: Statistics and Probability