Business, 14.05.2021 01:00 tyarber96

• Sales are budgeted at $340,000 for November, $360,000 for December, and $350,000 for January. • Collections are expected to be 75% in the month of sale and 25% in the month following the sale.
• The cost of goods sold is 68% of sales.
• The company desires an ending merchandise inventory equal to 80% of the cost of goods sold in the following month.
• Payment for merchandise is made in the month following the purchase.
• Other monthly expenses to be paid in cash are $22,200.
• Monthly depreciation is $22,000.
• Ignore taxes.
Balance sheet
Octobee 31
Assets
Cash $23,000
Accounts receivable 84.000
Merchandise Inventory 184,960
Property, plant and equipment (net of $
600,000 accumulated depreciation 1,014,000
Total assets $1,105.960
Liabilities and Stockholders' Equity
Accounts payable $197,00
Common stock 940,000
Retained earning 168,960
Total liabilities and stockholders' equity $1,105,960
Required:
a. Prepare a Schedule of Expected Cash Collections for November and December.
b. Prepare a Merchandise Purchases Budget for November and December.
c. Prepare Cash Budgets for November and December.
d. Prepare Budgeted Income Statements for November and December.
e. Prepare a Budgeted Balance Sheet for the end of December.

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• Sales are budgeted at $340,000 for November, $360,000 for December, and $350,000 for January. • C...

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