PACE MANAGERIAL ACC CUST LL W\ACC CARD
17th Edition
ISBN: 9781264382798
Author: Garrison
Publisher: MCG
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Chapter IE, Problem 17IE
1.
To determine
Operating activities are the normal, routine, and day-to-day business activities of the company from which the company earns a profit. The amount of the cash flow arising from operating activities is a key indicator of the extent to which the operations of the company have generated cash.
Net cash provided by operating activities
2.
To determine
The statement of cash flows records all of the sources and uses of cash in the business over a given time period. Cash activities are classified into three types: operating activities, investing activities, and financing activities.
Budgeted statement of cash flows for the year ended December 31, 2022
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Question 3
Mischa Furniture Stores (“MFS”) is a company that specialises in office furniture based in Windhoek. Due to the effects of Covid-19, it has become very imperative for the company to manage its cash flows effectively. The owner of MFS knows of your skills in management accounting and has requested your service in the preparation of the forth coming quarter’s cash budget. Upon interviews with different departments at MFS, you have ascertained the following information:
Budget information for January, February and March 2023 is as follows:
January
February
March
N$
N$
N$
Sales
590 000
650 000
750 000
Production costs
300 000
350 000
420 000
Sales and Administration costs
150 000
170 000
200 000
Purchase of non-current assets…
Paul's Pool Service provides pool cleaning, chemical application, and pool repairs for residential customers. Clients are billed weekly
for services provided and usually pay 40 percent of their fees in the month the service is provided, In the month following service, Paul
collects 50 percent of service fees. The final 10 percent is collected in the second month following service. Paul purchases his supplies
on credit, and pays 50 percent in the month of purchase and the remaining 50 percent in the month following purchase. Of the
supplies Paul purchases, 85 percent is used in the month of purchase, and the remainder is used in the month following purchase.
The following information is available for the months of June, July, and August, which are Paul's busiest months:
• June 1 cash balance $14,800.
• June 1 supplies on hand $4,000.
• June 1 accounts receivable $8,300.
• June 1 accounts payable $3,900.
· Estimated sales for June, July, and August are $24,900, $37,400, and $39,900,…
QUESTION 22
Which of the following are reasons to generate a pro forma cash budget on a
monthly basis?
a. An income statement indicates a profit but the budget may indicate a loss.
b. A business can monitor the actual cash on hand.
c. Sales are recognized as income when the sale is made.
d. All of the above.
Chapter IE Solutions
PACE MANAGERIAL ACC CUST LL W\ACC CARD
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