e-Built Problems Help Save&Exit; Check my SPORTS COMPAN Estimated Balance Sheet

Question

e-Built Problems Help Save&Exit; Check my SPORTS COMPAN Estimated Balance Sheet 31, 2017 Assets Caah Accounts receivable Inventory Total eurrent assets Equ ipment Leass sccumulated depreciation 36,000 520,000 95.000 ,00 564,000 70 500 492 5 1144,500 Equipment, net Total assets Liabilities and Bquity Accounts payable Bank loan payable Taxes payable (due 3/15/2018 360,00 15,000 S 466,900 Total 1iabilsties Conmon stock Retained earnings Total stockho1dezs equity Total liabilities and equity 473,500 To prepare a master budget for January, February,and March of 2018, manngement gathers the folowing information a. The company's single product is purchased for $20 per unit and resold for $57 per unt. The expected inventory level of 4750 unts on December 31, 2017, is more than management's desired tove, which is 20% o, the next months expected sates (in units Expected sales are January 7000 units: Februery, 8750 units, March, 10.500 units and Aprit, 10,000 units month after the month of sale and 43% in the second month after e month of sale Fore pecenter3t2orwears b. Cash sales and credit sales represent 25% and 75%, respectively, of total sales. Or the credt aies, SA s eo eesed n he nrst receivable balance, $130000 is collected in January and the remaining $390.000 is collected in Febnuary the second month c. Merchandise purch ases are paid for as folows 20% n the nrst month after the month of purchase and 80% ofter the month of purchase. For the December 31 2017, accounts payoble bolance $70,000 is paid in Januay and thie remaining

Explanation / Answer

Items January February March Sales units 7000 8750 10500 Sales revenue 399,000 498,750 598,000 Cost of sales 140,000 175,000 210,000 Inventory 20% of sales (units) 1400 1750 2100 Cash sales 99,750 124,688 149,500 Cash receivable 130,000 390,000+170,572 128677+213,215 Accounts receivable 390,000+299,812 374,062+128,677 448,500+160,846 Cash payable 70,000+ 290,000+28,000 112,000+35,000 Accounts payable 290,000+140,000 112,000+175,000 140,000+210,000

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