Welnor industrial gas corporation supplies acetylene and other compressed gases to industry. data regarding the store's operations follow:
•
sales are budgeted at $360,000 for november, $380,000 for december, and $370,000 for january.
•
collections are expected to be 75% in the month of sale, 22% in the month following the sale, and 3% uncollectible.
• the cost of goods sold is 70% of sales.
•
the company desires ending merchandise inventory to equal 85% of the following month's cost of goods sold. payment for merchandise is made in the month following the purchase.
• other monthly expenses to be paid in cash are $19,800.
• monthly depreciation is $14,800.
• ignore taxes.
balance sheet
october 31
assets
cash $ 20,800
accounts receivable (net of allowance for uncollectible accounts) 80,800
merchandise inventory 214,200
property, plant and equipment (net of $648,000 accumulated depreciation) 1,170,000
total assets $ 1,485,800
liabilities and stockholders’ equity
accounts payable $ 197,800
common stock 710,000
retained earnings 578,000
total liabilities and stockholders’ equity $ 1,485,800
required:
a.
prepare a schedule of expected cash collections for november and december. (omit the "$" sign in your response.)
welnor industrial gas corporation
schedule of expected cash collections
november december
sales $ $
schedule of expected cash collections
accounts receivable $
november sales $
december sales
total cash collections $ $
b.
prepare a merchandise purchases budget for november and december. (input all amounts as positive values. do not round intermediate calculations. omit the "$" sign in your response.)
welnor industrial gas corporation
merchandise purchases budget
november december
budgeted cost of goods sold $ $
(click to select)adddeduct: (click to select)beginning merchandise inventorydesired ending merchandising inventory
total needs
(click to select)deductadd: (click to select)beginning merchandise inventorydesired ending merchandising inventory
required purchase $ $
c.
prepare cash budgets for november and december. (leave no cells blank - be certain to enter "0" wherever required. input all amounts as positive values. omit the "$" sign in your response.)
welnor industrial gas corporation
cash budget
november december
cash disbursements for merchandise $ $
other monthly cash expenses
total cash disbursements $ $
cash balance, beginning $ $
add cash receipts
total cash available
less cash disbursement
excess (deficiency) of cash available
over disbursements
financing
cash balance, ending $ $
d.
prepare budgeted income statements for november and december. (input all amounts as positive values. omit the "$" sign in your response.)
welnor industrial gas corporation
budgeted income statement
november december
(click to select)salescost of goods solddepreciationnet operating incomeother monthly expensesbad debt expensegross margin $ $
(click to select)depreciationnet operating incomegross marginaccounts payablesalesother monthly expensescost of goods sold
(click to select)net operating incomeaccounts monthly expensesgross margincost of goods sold
(click to select)cost of goods soldbad debt expensenet operating incomeother monthly margin
(click to select)net operating incomeother monthly expensesbad debt expenseinventorygross marginsalescost of goods sold
(click to select)net operating incomesalesbad debt of goods soldgross margin
(click to select)depreciationbad debt expensenet operating incomecost of goods soldgross marginsalesother monthly expenses $ $
e.
prepare a budgeted balance sheet for the end of december. (be sure to enter your answers in the order of liquidity. input all amounts as positive values. omit the "$" sign in your response.)
welnor industrial gas corporation
budgeted balance sheet
december 31
assets
(click to select)inventoryaccounts receivablecashproperty, plant and equipment
(click to select)inventorycashproperty, plant and equipmentaccounts receivable
(click to select)inventoryaccounts receivableproperty, plant and equipmentcash
(click to select)accounts , plant and equipment
total assets
liabilities and stockholders’ equity
(click to select)retained earningscommon stockaccounts payablecash
(click to select)cashcommon stockinventoryaccounts payable
(click to select)inventoryaccounts payablecashretained earnings
total liabilities and stockholders’ equity