90.2K

Verified Solution

Link Copied!

Walker Company prepares monthly budgets. The current budget plans for a September ending merchandise inventory of 20,000 units. Company policy is to end each month with merchandise inventory equal to 10% of budgeted sales for the following month. Budgeted sales and merchandise purchases for the next three months follow. The company budgets sales of 200,000 units in October July August September Sales (Units) 200,000 310,000 300,000 Purchases (Units) 211,000 309,000 290,000 Prepare the merchandise purchases budgets for the months of July, August, and September. WALKER COMPANY Merchandise Purchases Budget For July, August, and September July August September 20,000 Budgeted ending inventory units Budgeted units sales for month Required units of available inventory Beginning inventory (units) Units to be purchased 211,000 309,000 290,000 Use the following information to prepare the July cash budget for Acco Co. It should show expected cash receipts and cash payments for the month and the cash balance expected on July 31. a. Beginning cash balance on July 1: $63,000. b. Cash receipts from sales: 35% is collected in the month of sale, 50% in the next month, and 15% in the second month after sale (uncollectible accounts are negligible and can be ignored). Sales amounts are May (actual), $1,910,000; June (actual), $1,410,000; and July (budgeted), $1,400,000. C. Payments on merchandise purchases: 85% in the month of purchase and 15% in the month following purchase. Purchases amounts are: June (actual), $590,000; and July (budgeted), $730,000. d. Budgeted cash payments for salaries in July: $220,000. e. Budgeted depreciation expense for July: $15,000. f. Other cash expenses budgeted for July: $160,000. g. Accrued income taxes due in July: $50,000. h. Bank loan interest paid in July: $9,000. Complete this question by entering your answers in the tabs below. Calculation Cash Budget Calculate the budgeted cash receipts and cash payments. Calculation of Cash Receipts from Sales ---Collected in--- Total Sales May June July 31 Accounts Rec. July Credit sales from: May $ 1,910,000 June 1,410,000 July 1,400,000 Totals $ 4,720,000 $ 0 $ 0 $ 0 $ 0 Calculation of Cash Payments for Merchandise --Paid in-------- July 31 Total Purchases June July Accounts Pay. Purchases from: June $ 590,000 July 730,000 Totals $ 1,320,000 $ 0 $ 0 $ 0 Calculation Cash Budget Complete this question by entering your answers in the tabs below. Calculation Cash Budget Prepare the July cash budget for Acco Co. ACCO CO. Cash Budget For the Month Ended July 31 Total cash available Cash payments for: Total cash payments $ 0

Answer & Explanation Solved by verified expert

See Answer