60.1K

Verified Solution

Link Copied!

CoursHeroTranscribedText: Problem 13-58 (Algo) Budgeted Purchases and Cash Flows (L013-4, 5. 6} Mast Corporation seeks your assistance in developing cash and other budget information for May. June, and July. At April 30, the company had cash of $11,000, accounts receivable of $888,000. inventories of $193,500, and accounts payable of $55,523. The budget is to be based on the following assumptions. . Each month's saies are billed on the last day ofthe month. . Customers are allowed a 2 percent discount if payment is made within 10 days after the billing date. Receivables are recorded in the accounts at their gross amounts [not net ofdiscounts]. . The billings are collected as follows: T5 percent within the discount period. 10 percent by the end ofthe month. and 12 percent by the end ofthe following month. Three percent is uncollectible. Purchase data are as follows. . Ofall purchases of merchandise and selling. general. and administrative expenses, 5? percent is paid in the month purchased and the remainder in the following month. . The number of units in each month's ending inventory equals 125 percent ofthe next month's units of sales. . The cost of each unit ofinventory is $12. . Selling. general. and administrative expenses, of which $5,000 is depreciation. equal 20 percent ofthe current month's sales. . Actual and projected sales follow: Dollars Units F-lar'ch $183,599 19,999 April 239,799 14,199 May 219 , 399 12, 999 aune 193,899 11,499 July 221,999 13,999 August 16,489 13, 299 Required: a. Compute the budgeted purchases in dollars for May. b. Compute the budgeted purchases in dollars for June. c. Compute the budgeted cash collections during May. [Do not round intermediate calculations. Round your final answer to nearest whole dollar.) d. Compute the budgeted cash disbursements during June. [Do not round intermediate calculations. Round your final answer to nearest whole dollar.) e. Compute the budgeted number of units ofinventory to be purchased during July. Required: a. Compute the budgeted purchases in dollars for May. b. Compute the budgeted purchases in dollars torJurIe. c. Compute the budgeted cash collections during May. {Do not round intermediate calculations. Round your ne! answer to nearest whole dollar.} d. Compute the budgeted cash disbursements during June. [Do not round intermediate calcuiations. Round your nal answer to nearest whole dollar.) e. Compute the budgeted number of units of inventory to be purchased during July. $ $ 132.300 150:300 Budgeted purchases for May B u dgeted purchases for June c. Budgeted cash collections d. Budgeted cash disbursements e. Budgeted number of units

Answer & Explanation Solved by verified expert

See Answer