Prepare budgeted income statement for the first six months

Assignment Help Financial Management

Reference no: EM131856152

The following basic information relates to a new business and its expected performance over the next six months.

1. Puts in capital of $40,000.

2. Buys, for cash, goods for resale amounting to $60,000.

3. Sells, on credit, three-quarters of these goods at a selling price of cost plus 40%. By the end of the period, only 75% of customers had paid for the goods purchased.

4. Pays wages of $12,000 in cash.

5. Pays other expenses of $4,000 in cash.

6. Buys a new vehicle for $30,000, $15,000 paid in cash and the rest on loan carrying interest at 10% per annum.

(a) Prepare a budgeted income statement for the first six months. (b) Prepare a budgeted statement of financial position at the end of the six months. (c) Prepare a budgeted summary statement of cash flows for the first six months. (d) Identify the critical decisions (possibly implicit) that have been made that have led to the resulting cash balance. (e) How might this situation have been avoided?

Reference no: EM131856152

Questions Cloud

Discuss why the study of group dynamics is important : Discuss why the study of group dynamics is important to today's managers, and how it would be useful to your selected organization, in particular.

Prompts the user to enter a number within an input box : Prompts the user to enter a number within an Input Box Reads in the value entered by the user

Calculate bond equivalent yield and effective annual return : Calculate the bond equivalent yield and effective annual return on a jumbo CD that is 120 days from maturity and has a quoted nominal yield of 6.64 percent.

Server socket to listen for connections on port 8081 : When the program starts, it should open a server socket to listen for connections on port 8081. When a client connection is received, the program

Prepare budgeted income statement for the first six months : Prepare a budgeted income statement for the first six months. Prepare a budgeted statement of financial position at the end of the six months.

Describe the fft and why it is important : Suppose you are on a job interview at Google, and you are asked to describe the FFT and why it is important. What is your answer?

Using the specification below subnet the network : You are given the 10.10.10.64/24 network. Using the specification below subnet the network.

Discuss given statement is correct or incorrect and why : Industry is ahead of government regulators in the field of E-business? Please explain whether this statement is correct or incorrect and why?

What are the cons of re-sizing your images using html : What are the cons of re-sizing your images using HTML/CSS? How does it affects the overall performance of your web page? Explain your answer.

User Account

All Pages