Question

Sweet Candy Corp. has prepared the following financial statements:

Sweet Candy Corp.				Sweet Candy Corp.
Income Statement				Balance Sheet
For the Year Ended Dec. 31 2017				As of Dec. 31 2017
	2017	2016		Assets	2017	2016
Sales	3,074,000	2,567,000		Cash	431,000	339,000
Cost of Goods Sold	2,088,000	1,711,000		Accounts Receivable	503,000	365,000
Gross Profit	986,000	856,000		Inventories	289,000	300,000
Selling and G&A Expenses	294,000	295,000		Total Current Assets	1,223,000	1,004,000
Fixed Expenses	35,000	35,000		Gross Fixed Assets	4,669,000	4,322,000
Depreciation Expense	239,000	223,000		Accumulated Depreciation	2,295,000	2,056,000
EBIT	418,000	303,000		Net Fixed Assets	2,374,000	2,266,000
Interest Expense	93,000	91,000		Total Assets	3,597,000	3,270,000
Earnings Before Taxes	325,000	212,000		Liabilities and Owners' Equity
Taxes	94,000	64,000		Accounts Payable	382,000	270,000
Net Income	231,000	148,000		Short-term Notes Payable	79,000	99,000
				Accrued Expenses	159,000	114,000
				Total Current Liabilities	620,000	483,000
				Long-term Debt	1,023,000	967,000
				Total Liabilities	1,643,000	1,450,000
				Common Stock	819,000	808,000
				Retained Earnings	1,135,000	1,012,000
				Total Shareholder's Equity	1,954,000	1,820,000
				Total Liabilities and Owners' Equity	3,597,000	3,270,000

Set up a worksheet similar to the one in Exhibit 3-6, page 92, and calculate all of the ratios for Sweet Candy Corp.

The Right Target, Inc., a marketing research and consulting firm, is working on a cash budget for July to December 2017. The staff has projected the following cash collections and payments:

Month	Collections		Payments
	Cash Sales	Credit Sales	Purchases	Wages	Miscellaneous Expenses
July	$10,000	$20,000	$15,000	$6000	$1,500
August	$12,000	$24,000	$18,000	$7,200	$2,000
September	$14,000	$28,000	$21,000	$8,400	$2,500
October	$16,000	$32,000	$24,000	$9,600	$3,000
November	$20,000	$40,000	$30,000	$12,000	$4,000
December	$25,000	$50,000	$37,500	$15,000	$4,500

If the ending cash balance as of June 30, 2017 was $10,000, determine the firm’s forecasted monthly cash balance.

Please show work

Answer 1

For the question of Sweet Candy Corp, you need to provide Exhibit 3-6, page 92.

The solution of next question is given as under:

The Right Target Inc.
Cash Budget
For the period from July to Dec. 2017
	July	Aug	Sept	Oct	Nov	Dec	Total
Balance Beginning	10000	17500	26300	36400	47800	61800	10000
Cash Collections
Cash Sales	10000	12000	14000	16000	20000	25000	97000
From Credit sales	20000	24000	28000	32000	40000	50000	194000
Total cash available	40000	53500	68300	84400	107800	136800	301000
Payments
Purchases	15000	18000	21000	24000	30000	37500	145500
Wages	6000	7200	8400	9600	12000	15000	58200
Misc. Expenses	1500	2000	2500	3000	4000	4500	17500
Total cash Payments	22500	27200	31900	36600	46000	57000	221200
Balance ending	17500	26300	36400	47800	61800	79800	79800