Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 11,100 Accounts receivable 72,500 Inventory 37,500 Buildings and equipment, net of depreciation 238,000 Total assets $ 359,100 Liabilities and Stockholders’ Equity Accounts payable $ 68,000 Note payable 19,400 Common stock 180,000 Retained earnings 91,700 Total liabilities and stockholders’ equity $ 359,100 The company is in the process of preparing a budget for May and has assembled the following data: Sales are budgeted at $255,000 for May. Of these sales, $76,500 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 in the following month. All of the April 30 accounts receivable will be collected in May. Purchases of inventory are expected to total $189,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May. The May 31 inventory balance is budgeted at $77,500. Selling and administrative expenses for May are budgeted at $93,600, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $6,250 for the month. The note payable on the April 30 balance sheet will be paid during May, with $370 in interest. (All of the interest relates to May.) New refrigerating equipment costing $8,600 will be purchased for cash during May. During May, the company will borrow $29,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year. Required: Calculate the expected cash collections from customers for May. Calculate the expected cash disbursements for merchandise purchases for May. Prepare a cash budget for May. Prepare a budgeted income statement for May. Prepare a budgeted balance sheet as of May 31.
Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 11,100 Accounts receivable 72,500 Inventory 37,500 Buildings and equipment, net of depreciation 238,000 Total assets $ 359,100 Liabilities and Stockholders’ Equity Accounts payable $ 68,000 Note payable 19,400 Common stock 180,000 Retained earnings 91,700 Total liabilities and stockholders’ equity $ 359,100 The company is in the process of preparing a budget for May and has assembled the following data: Sales are budgeted at $255,000 for May. Of these sales, $76,500 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 in the following month. All of the April 30 accounts receivable will be collected in May. Purchases of inventory are expected to total $189,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May. The May 31 inventory balance is budgeted at $77,500. Selling and administrative expenses for May are budgeted at $93,600, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $6,250 for the month. The note payable on the April 30 balance sheet will be paid during May, with $370 in interest. (All of the interest relates to May.) New refrigerating equipment costing $8,600 will be purchased for cash during May. During May, the company will borrow $29,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year. Required: Calculate the expected cash collections from customers for May. Calculate the expected cash disbursements for merchandise purchases for May. Prepare a cash budget for May. Prepare a budgeted income statement for May. Prepare a budgeted balance sheet as of May 31.
Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash $ 11,100 Accounts receivable 72,500 Inventory 37,500 Buildings and equipment, net of depreciation 238,000 Total assets $ 359,100 Liabilities and Stockholders’ Equity Accounts payable $ 68,000 Note payable 19,400 Common stock 180,000 Retained earnings 91,700 Total liabilities and stockholders’ equity $ 359,100 The company is in the process of preparing a budget for May and has assembled the following data: Sales are budgeted at $255,000 for May. Of these sales, $76,500 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 in the following month. All of the April 30 accounts receivable will be collected in May. Purchases of inventory are expected to total $189,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May. The May 31 inventory balance is budgeted at $77,500. Selling and administrative expenses for May are budgeted at $93,600, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $6,250 for the month. The note payable on the April 30 balance sheet will be paid during May, with $370 in interest. (All of the interest relates to May.) New refrigerating equipment costing $8,600 will be purchased for cash during May. During May, the company will borrow $29,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year. Required: Calculate the expected cash collections from customers for May. Calculate the expected cash disbursements for merchandise purchases for May. Prepare a cash budget for May. Prepare a budgeted income statement for May. Prepare a budgeted balance sheet as of May 31.
Minden Company is a wholesale distributor of premium European chocolates. The company’s balance sheet as of April 30 is given below:
Minden Company
Balance Sheet
April 30
Assets
Cash
$ 11,100
Accounts receivable
72,500
Inventory
37,500
Buildings and equipment, net of depreciation
238,000
Total assets
$ 359,100
Liabilities and Stockholders’ Equity
Accounts payable
$ 68,000
Note payable
19,400
Common stock
180,000
Retained earnings
91,700
Total liabilities and stockholders’ equity
$ 359,100
The company is in the process of preparing a budget for May and has assembled the following data:
Sales are budgeted at $255,000 for May. Of these sales, $76,500 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 in the following month. All of the April 30 accounts receivable will be collected in May.
Purchases of inventory are expected to total $189,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May.
The May 31 inventory balance is budgeted at $77,500.
Selling and administrative expenses for May are budgeted at $93,600, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $6,250 for the month.
The note payable on the April 30 balance sheet will be paid during May, with $370 in interest. (All of the interest relates to May.)
New refrigerating equipment costing $8,600 will be purchased for cash during May.
During May, the company will borrow $29,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year.
Required:
Calculate the expected cash collections from customers for May.
Calculate the expected cash disbursements for merchandise purchases for May.
Prepare a cash budget for May.
Prepare a budgeted income statement for May.
Prepare a budgeted balance sheet as of May 31.
Definition Definition Assets available to stockholders after a company's liabilities are paid off. Stockholders’ equity is also sometimes referred to as owner's equity. A stockholders’ equity or book value generally includes common stock, preferred stock, and retained earnings and is an indicator of a company's financial strength.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
