Quarterly cash dividends are planned, Financial Accounting

Given the information that follows, draw a cash budget for the XYZ Store for the first six months of 2012.

  • Every prices and costs remain constant.
  • Sales are 80% for credit and 20% for cash.
  • With respect to credit sales, 55% are collected in the month after the sale, 30% in the second month, and 15% in the third.  Bad-debt losses are insignificant.
  • Sales, actual and estimated, are:

October 2011

$300,000

March 2012

$200,000

November 2011

450,000

April 2012

350,000

December 2011

400,000

May 2012

280,000

January 2012

200,000

June 2012

220,000

February 2012

250,000

July 2012

320,000

  • Payments for purchases of merchandise are 90% of the following month's anticipated sales.
  • Wages and salaries are:

January 2012

$40,000

April 2012

$50,000

February 2012

45,000

May 2012

45,000

March 2012

55,000

June 2012

55,000

  • Rent is $5,000 a month.
  • Interest of $8,500 is due on the last day of every calendar quarter, and no quarterly cash dividends are planned.
  • A tax prepayment of $60,000 for 2012 income is due in April.
  • A capital investment of $60,000 is planned in June, to be paid for then.
  • The company has a cash balance of $90,000 at December 31, 2011, which is the minimum desired level for cash.  Funds can be borrowed in multiples of $5,000. (Ignore interest on this type of borrowings.)

 

Posted Date: 3/22/2013 1:14:50 AM | Location : United States







Related Discussions:- Quarterly cash dividends are planned, Assignment Help, Ask Question on Quarterly cash dividends are planned, Get Answer, Expert's Help, Quarterly cash dividends are planned Discussions

Write discussion on Quarterly cash dividends are planned
Your posts are moderated
Related Questions

What are main factors that Nor'easters should take into account in establishing a pricing policy? The minor revenue generators of Nor'easters include corporate sponsorships and

Significant Deficiency -Control deficiency or combination of control deficiencies, which adversely affects company's ability to authorize, initiate, process, record or report exte

prepare an balance sheet

Assume your grandparents have just given you $20,000 on the condition that you invest the money in the stock market. As you contemplate making your investment choices, what account

How do you report a note in exchange for treasury stock

tyoes of assets

Equitable apportionments There are five leading cases where the courts have laid down rules to meet specific situations in which there is a conflict of interest between life tena

Illustration of Accounting treatment of deferred tax A Ltd., bought an item of plant at a cost of £100,000 in year 2000. The estimated useful life of the plant was 5 years and

Q. Explain about Material event? Subsequent Event - Material event which takes place after the end of accounting period and before the publication of an entity's FINANCIAL STAT