You have just been hired as a new management trainee by XYZ Co, a distributor of earrings to various retail outlets located in shopping malls across the country. In the past, the company has done very little in the way of budgeting and at certain times of the year has experienced a shortage of cash. Since you are well trained in budgeting, you have decided to prepare comprehensive budgets for the upcoming second quarter in order to show management the benefits that can be gained from an integrated budgeting program. To this end, you have worked with accounting and other areas to gather the information assembled below. The company sells many styles of earrings but all are sold for the same price ($10 per pair). Actual sales of earrings for the last three months and budgeted sales for the next six months follow (in pairs of earrings): January (actual) 20000 February (actual) 26000 March (actual) 40000 April (budget) 65000 May (budget) 100000 June (budget) 50000 July (budget) 30000 August (budget) 28000 September (budget) 25000
The concentration of sales before and during May is due to Mother’s Day. Sufficient inventory should be on hand at the end of each month to supply 40% of the earrings sold in the following month.
Suppliers are paid $4 for a pair of earrings. One half of a month’s purchases is paid for in the month of purchase – the other half is paid for in the following month. All sales are on credit, with no discount and payable within 15 days. The company has found, however, that only 20% of a month’s sales are collected in the month of sale. An additional 70% is collected in the following month and the remaining 10% is collected in the second month following the sale. Bad debts have been negligible.
Monthly operating expenses for the company are given below: Sales commissions 4% of sales Fixed: Advertising $2,00,000.00 Rent $18,000.00 Salaries $1,06,000.00 Utilities $7,000.00 Insurance $3,000.00 Depreciation $14,000.00 Insurance is paid on an annual basis, in November of each year. The company plans to purchase $16,000 in new equipment during May and $40,000 in new equipment during June – both purchases will be for cash. The company declares dividends of $15,000 each quarter, payable in the first month of the following quarter.
A listing of the company’s leger accounts as of March 31st are given below: Assets Cash……………………………………..………………………………………………………………………………………………..$74,000 Accounts receivable ($26,000 February sales. $320,000 March sales)………………………………….….$346,000 Inventory…………………….………………………………………………………………………………………………………..…104,000 Prepaid Insurance…………………………………………………………………………………………………………..…….…..21,000 Property & Equipment (net)…………………………………………………………………………………………….……..950,000 Total Assets:…………………………………………………………………………………………………………..…………..$1,495,000 Liabilities & Stockholder’s Equity Accounts Payable……………………………..………………………………………………………………………………..$100,000 Dividends Payable………………………………………………………….………………………………………………..…15,000 Common Stock……………………………………………………………..……………………………………………………..800,000 Retained Earnings…………………………………………………………………………………………….……..…………..580,000 Total Liabilities & Stockholders’ Equity……………………………………………………………….……..……$1,495,000 The company maintains a minimum cash balance of $50,000. All borrowing is done at the beginning of a month – any repayments are made at the end of a month. The company has an agreement with a bank that allows the company to borrow in increments of $1,000 at the beginning of each month. The interest rate on these lands is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company would pay the bank all of the accumulated interested on the loan and as much of the loan as possible (in increments of $1,000) while still retaining at least $50,000 in cash. Required (PLEASE PRESENT IN EXCEL): 1. Prepare a master budget including sales budget and merchandise purchase budget 2. Schedule of expected cash collections 3. Schedule of expected cash payments 4. Cash budget 5. Budgeted income statement
Try it now!
How it works?
Follow these simple steps to get your paper done
Place your order
Fill in the order form and provide all details of your assignment.
Proceed with the payment
Choose the payment system that suits you most.
Receive the final file
Once your paper is ready, we will email it to you.
Our Services
Custom Writings Help is a Quality-Oriented Company in Online Writing as a result of hiring exceptional professionals to execute clients' tasks.
Essays
At Custom Writings Help,We understand the struggle of research paper writing, and that is why at Custom WritingS Help, we are all out to help you. We pride ourselves on having a team of clinical writers. The stringent and rigorous vetting process ensures that only the 'BEST' Writers are chosen for the job. We have highly qualified Ph.D. and MA writers working with us; we equally offer these experienced writers specific bonuses and incentives to make them deliver highly original, unique, and informative content at reasonably low prices.
Admissions
Thesis Writing Service
Worlwide, Many Masters Students are struggling with Thesis Completion. A thesis is likely to be the longest and most challenging piece of work a student has ever completed. However, unlike essays and other assignments, a student can pick a particular interest topic and work on their initiative. Fortunately, we are there for you. At Custom Writings Help, you are assured of an authentic, imaginative, informative, linguistically great, and advantageous thesis that adheres to all your needs. So, why continue considering different writers when you have discovered the best in the field?
Editing
Custom Papers
Not a single student can avoid writing custom papers. However, a total lack of experience, skills, and time makes it very hard to produce a superb writing piece. Therefore, if you are seeking professional help, turn to us. Our specialized and experienced writers compose a variety of model papers, including custom essays, college term papers, research papers, book reports, MBA essays, executive summaries, dissertations, Ph.D. theses, admission essays, and research proposals for college and university students at any level.
Coursework
Essay Writing
Most of the students disregard the critical principles of essay writing and compose papers below sensible guidelines. Therefore, with Custom Writings Help, one should not worry about his/her essay. Our Writers compose informative and engaging content on all complexities and topics. We write meaningful and smart essays while prioritizing all aspects that bring about a good grade, such as impeccable grammar, proper structure, zero-plagiarism, and conformance to guidelines.
Coursework
Coourse Work Writing
Don't let the seemingly never-ending onslaught of writing assignments get you down. If you are looking where to get course work assistance online, the writers at Custom Writings Help are here to assist you with all of your writing needs. We undertake to unique delivery of papers that meet the professor's requirements. The content is proofread, edited, and checked plagiarism before submission to customers. No matter how big or small your work is, we will deliver on time. Try US Now! !
Coursework
Dissertation Writing Service
High-Quality Dissertation Writing Services are rare. They require Ph.D. academicians – not easily found. However, are an exception. The years, time, and resources we have invested in the dissertation world has given us a competitive advantage over others. Choose to come to Custom Writings Help; You will find perfect Ph.D. consultants who have written hundreds of dissertations theses ready to help you. Let our dissertation-writing services help you craft your dissertation, for you are assured we will give you the results.