Prepare a debtors collection schedule Additional information1.All inventories are sold at cost plus 25%.2.Sales are expected to be spread out evenly throughout each financial year. Sales are expected to increaseby 18% for the financial year ending 31 May 2023.3.Fifty percent (50%) of the sales are for cash and the balance is on credit. As from 01 June 2022 thirtypercent (30%) of the cash sales is expected to be made to large retailers who will be granted a 10% cashdiscount. Collections from credit sales are usually as follows:* 40% in the month of sale, and these debtors are entitled to a 5% discount;* 55% in the month after the sale.The balance is usually written off as bad debts.Inventories are kept at a constant level. Sixty percent (60%) of the purchases are for cash and the balanceis on credit. Creditors are paid in the month after the purchase.4.In terms of the lease agreement the rental is received monthly. The rent for the year ending 31 May 2023 isexpected to be 10% more than the previous twelve months.5.6.Advertising is paid for monthly and is estimated to be the same percentage of sales (excluding discounts)as for the financial year ended 31 May 2022.7.Salaries increase by 10% on 01 December of each year.8.Rates and taxes will be paid in one instalment for the year during July 2022. Rates are calculated at 80cents (RO.80) per R100 on the value of the premises. The premises are valued at R3 000 000.9.Other operating expenses are expected to increase by 5% and are spread evenly throughout the year.They are paid for in the month in which they are incurred.10.An unfavourable bank balance of R180 000 is expected on 31 May 2022. Prepare the following for June and July 2022 from the information provided below.4.1Debtors Collection ScheduleINFORMATIONThe information provided below was taken from the forecasts of Rustom Wholesalers for the financial year ended 31May 2022.EXTRACT OF THE BUDGETED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MAY2022RSales4 800 000Cost of sales2 400 000Rent income120 000Advertising48 000Salaries756 000Rates and taxes12 000Other operating expenses960 000

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Description: Prepare a debtors collection schedule Additional information1.All inventories are sold at cost plus 25%.2.Sales are expected to be spread out evenly throughout each financial year. Sales are expected to increaseby 18% for the financial year ending 31

Debtors’ collection schedule is the schedule which shows the collections which are received from the…

Answered: Prepare the following for June and July…

Business

Accounting

Prepare the following for June and July 2022 from the information provided below. 4.1 Debtors Collection Schedule

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 3PA: Echo Amplifiers prepared the following sales budget for the first quarter of 2018: It also has this...

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Budgeted income statement and balance sheet As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 20Y9, the following tentative trial balance as of December 31, 20Y8, is prepared by the Accounting Department of Mesa Publishing Co.: Factory output and sales for 20Y9 are expected to total 3,800 units of product, which are to be sold at 120 per unit. The quantities and costs of the inventories at December 31, 20Y9, are expected to remain unchanged from the balances at the beginning of the year. Budget estimates of manufacturing costs and operating expenses for the year are summarized as follows: Balances of accounts receivable, prepaid expenses, and accounts payable at the end of the year are not expected to differ significantly from the beginning balances. Federal income tax of 35,000 on 20Y9 taxable income will be paid during 20Y9. Regular quarterly cash dividends of 0.20 per share are expected to be declared and paid in March, June, September, and December on 20,000 shares of common stock outstanding. It is anticipated that fixed assets will be purchased for 22,000 cash in May. Instructions Prepare a budgeted income statement for 20Y9. Prepare a budgeted balance sheet as of December 31, 20Y9, with supporting calculations.
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CASH BUDGETING Helen Bowers, owner of Helens Fashion Designs, is planning to request a line of credit from her bank. She has estimated the following sales forecasts for the firm for parts of 2019 and 2020: Estimates regarding payments obtained from the credit department are as follows: collected within the month of sale, 10%; collected the month following the sale, 75%; collected the second month following the sale, 15%. Payments for labor and raw materials are made the month after these services were provided. Here are the estimated costs of labor plus raw materials: General and administrative salaries are approximately 27,000 a month. Lease payments under long-term leases are 9,000 a month. Depreciation charges are 36,000 a month. Miscellaneous expenses are 2,700 a month. Income tax payments of 63,000 are due in September and December. A progress payment of 180,000 on a new design studio must be paid in October. Cash on hand on July 1 will be 132,000, and a minimum cash balance of 90,000 should be maintained throughout the cash budget period. a. Prepare a monthly cash budget for the last 6 months of 2019. b. Prepare monthly estimates of the required financing or excess fundsthat is, the amount of money Bowers will need to borrow or will have available to invest. c. Now suppose receipts from sales come in uniformly during the month (that is, cash receipts come in at the rate of 1/30 each day), but all outflows must be paid on the 5th. Will this affect the cash budget? That is, will the cash budget you prepared be valid under these assumptions? If not, what could be done to make a valid estimate of the peak financing requirements? No calculations are required, although if you prefer, you can use calculations to illustrate the effects. d. Bowers sales are seasonal, and her company produces on a seasonal basis, just ahead of sales. Without making any calculations, discuss how the companys current and debt ratios would vary during the year if all financial requirements were met with short-term bank loans. Could changes in these ratios affect the firms ability to obtain bank credit? Explain.
Prepare a budgeted income statement for the month ending March 31, 2016.
Classify each of the following actions as either being associated with the financial accounting information system (FS) or the cost management information system (CMS): a. Determining the total compensation of the CEO of a public company b. Issuing a quarterly earnings report c. Determining the unit product cost using TDABC d. Calculating the number of units that must be sold to break even e. Preparing a required report for the SEC f. Preparing a sales budget g. Using cost and revenue information to decide whether to keep, or drop, a product line h. Preparing an annual statement of financial position that conforms to generally accepted accounting principles (GAAP) i. Using cost and revenue information to decide whether to invest in a new production system or not j. Reducing costs by improving the overall quality of a product k. Using a debt-equity ratio and liquidity ratios from a balance sheet to assess the likelihood of bankruptcy l. Using a public companys financial statements to decide whether or not to buy its stock