Reference no: EM131764903
Question: Jodi Horton, president of the retailed Crestline Products, has just approached the company's bank with a request for a $30,000, 90-day loan. The purpose of the loan is to assist the company in acquiring inventories in support of peak April sales. Since the company has had some difficulty in paying off its loans in the past, the loan officer has asked for a cash budget to help determine whether the loan should be made. The following data are available for the months April - June, during which time the loan will be used:
a) On April 1, the cash balance will be $26,000. Accounts receivable on April will total $162,000, of which $150,000 will be collected during April and $9,000 will be collected during May. The remainder will be uncollectible.
b) Past experience shows that 20% of a month's sales are collected in the month of sale, 75% in the month following sale, and 4% in the second month following sale. The other 1% represents bad debts that are never collected. Budgeted sales and expenses for the three-month period follow:
|
April
|
May
|
June
|
Sales (all on account)
|
$200,000
|
$300,000
|
$250,000
|
Merchandise purchases
|
$120,000
|
$180,000
|
$150,000
|
Payroll
|
9,000
|
9,000
|
9,000
|
Lease payments
|
15,000
|
15,000
|
15,000
|
Advertising
|
70,000
|
80,000
|
60,000
|
Equipment purchases
|
8,000
|
0
|
0
|
Depreciation
|
10,000
|
10,000
|
10,000
|
c) Merchandise purchases are paid in full during the month following purchase. Accounts payable for merchandise purchases on March 31, which will be paid during April total $108,000.
d) In preparing the cash budget, assume that the $30,000 loan will be made in April and repaid in June. Interest on the loan will total $1,200.
Required: Prepare a cash budget, by month and in total, for the three month period. Use the attached worksheet to record your answers, showing all calculated work where necessary. If the company needs a minimum cash balance of $25,000 to start each month, can the loan be repaid as planned? Explain.
Normalize the following tables
: Normalize the following tables (each table should be in 3NF at least):
|
Declare four instance variables as follows
: (a) Declare a class named Bank. (b) Declare four instance variables as follows, all must be private: The first variable is of type String and named accountID.
|
Why might jim prefer the executor to use fmv
: Jim inherits stock (a capital asset) from his brother, who died in March of 2015, when the property had a $6.9 million FMV.
|
Discuss deontological ethics and categorical imperative
: Choose to discuss one of the following contemporary ethical theories: egoism, utilitarianism, deontological ethics, categorical imperative
|
Budgeted sales and expenses for the given time period
: Past experience shows that 20% of a month's sales are collected in the month of sale, 75% in the month following sale, and 4% in the second month following.
|
Issues relating to ethical considerations for budgetary
: Discuss issues relating to ethical considerations for budgetary forecasting and projections to explain the strength of assumptions and forecast reliabilities
|
Do you think we would have moral responsibilities to them
: Most of you are probably familiar with science fiction films in which sophisticated robots are indistinguishable in speech and behavior from human beings.
|
Compute the amount that scott company has to pay
: Scott Company purchased goods with the following terms and details: Sales price, $10,000, Compute the amount that Scott Company has to pay to the seller
|
Problem on joint-process cost allocations
: Joint-process cost allocations arise from the need to assign joint-process costs to a single product manufactured from a common input.
|