Weltin Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow: Sales are budgeted at $390,000 for November, $370,000 for December, and $380,000 for January. Collections are expected to be 90% in the month of sale, 5% in the month following the sale, and 5% uncollectible. The cost of goods sold is 60% of sales. The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are $21,800. Monthly depreciation is $18,000. Ignore taxes. Questions： 1.Prepare Budgeted Income Statements for November and December. 2.Prepare a Budgeted Balance Sheet for the end of December.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Weltin Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow:
Sales are budgeted at $390,000 for November, $370,000 for December, and $380,000 for January.
Collections are expected to be 90% in the month of sale, 5% in the month following the sale, and 5% uncollectible.
The cost of goods sold is 60% of sales.
The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase.
Other monthly expenses to be paid in cash are $21,800.
Monthly
Ignore taxes.
Questions：
1.Prepare
2.Prepare a Budgeted Balance Sheet for the end of December.
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