The balance sheet of Phototec, Inc., a distributor of photographic supplies, as
ID: 2460873 • Letter: T
Question
The balance sheet of Phototec, Inc., a distributor of photographic supplies, as of May 31 is given below:
550,000
671,000
80,000
671,000
Sales are budgeted at $300,000 for June. Of these sales, $70,000 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 the following month. All of the May 31 accounts receivable will be collected in June.
Purchases of inventory are expected to total $190,000 during June. These purchases will all be on account. Forty percent of all inventory purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the May 31 accounts payable to suppliers will be paid during June.
Selling and administrative expenses for June are budgeted at $66,000 , exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $2,500 for the month.
The note payable on the May 31 balance sheet will be paid during June. The company’s interest expense for June (on all borrowing) will be $800 , which will be paid in cash.
During June, the company will borrow $23,000 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year.
Prepare schedule of expected cash collections from sales and a schedule of expected cash disbursements for inventory purchases.
Prepare a cash budget for June. (Input all amounts as positive values except cash deficiency, repayments and interest which should be indicated by a minus sign.)
Prepare a budgeted balance sheet as of June 30. (Be sure to list the assets and liabilities in order of their liquidity.)
The balance sheet of Phototec, Inc., a distributor of photographic supplies, as of May 31 is given below:
Explanation / Answer
Answer:1a
Answer:1b
Answer:2
Answer:3
Schedule of Expected cash collections Cash sales-June 70000 Collections on accounts receivable: May 31 balance 77000 May sales 115000 Total cash receipts 262000 Schedule of expected cash disbursement May 31 Accounts payable balance 101000 May Purchases 76000 Total cash Payments 177000Related Questions
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