QUESTION 4 3. Roger Wills & Company estimates the following for 2016 (20 points)
ID: 2467014 • Letter: Q
Question
QUESTION 4
3. Roger Wills & Company estimates the following for 2016 (20 points):
Sales (all on account)
$800,000
Collections of accounts receivable
700,000
Proceeds from bond issuance
500,000
Proceeds from sale of common stock
300,000
Merchandise bought on credit
650,000
Payments of accounts payable
500,000
Cash payments of expenses
70,000
Cash purchase of equipment
140,000
Depreciation of equipment
15,000
Payment on notes payable
30,000
The ending cash balance for 2009 was $200,000.
Prepare a cash budget to determine the ending cash balance for 2010.
Sales (all on account)
$800,000
Collections of accounts receivable
700,000
Proceeds from bond issuance
500,000
Proceeds from sale of common stock
300,000
Merchandise bought on credit
650,000
Payments of accounts payable
500,000
Cash payments of expenses
70,000
Cash purchase of equipment
140,000
Depreciation of equipment
15,000
Payment on notes payable
30,000
Explanation / Answer
Particulars Amount Opening Cash Balance 200000 Add: Cash Receipts Accounts Receivables 700000 Proceeds from bond issunace 500000 Proceeds from sale of common stock 300000 Total Receipts 1500000 Less: Cash Payments Payments of accounts payables 500000 Cash payment of expenses 70000 Cash Purchase of equipment 140000 Payment of notes payables 30000 Total Payments 740000 Ending cash balance 960000
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