Question

The following information is from Barkley’s Auto Alarm Company financial records. Collections from customers are normally...

The following information is from Barkley’s Auto Alarm Company financial records. Collections from customers are normally 70 percent in the month of sale, 20 percent in the month following the sale, and 9 percent in the second month following the sale. The balance is expected to be uncollectible. All purchases are on account. Management takes full advantage of the 3 percent discount allowed on purchases paid for by the tenth of the following month. Purchases for December are budgeted at $72,000, and sales for December are forecasted at $78,000. Cash disbursements for expenses are expected to be $16,800 for the month of December. The company’s cash balance on December 1 was $28,000.

Month Sales Purchases
August $ 84,000 $ 54,000
September 78,000 60,000
October 72,000 48,000
November 90,000 66,000

Required:

Prepare the expected cash collections during December.

Prepare the expected cash disbursements during December.

Prepare the expected cash balance on December 31.

Complete this question by entering your answers in the tabs below.

Required A

Required B

Required C

Prepare the expected cash collections during December.
Month Expected Collections
October
November
December
Total $0

Prepare the expected cash disbursements during December.
BARKLEY’S AUTO ALARM COMPANY
Expected Cash Disbursements
December
November purchases to be paid in December
Net $0
Cash disbursements for expenses
Total $0

Prepare the expected cash balance on December 31.
BARKLEY’S AUTO ALARM COMPANY
Expected Cash Balance
December 31
Balance, December 1
Expected balance $0
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Month Expected Collections
October 7,560 + 15,600 + 50,400 = $ 73,560.00
November 7,020 + 14,400 + 63,000 = $ 84,420.00
December 6,480 + 18,000 + 54,600 = $ 79,080.00
Total Collections $ 237,060.00
Barkleys Auto Alarm Company
Expected Cash Disbursements
December Amount ($)
November purchases to be paid in December 66,000.00
Less : Discount 3 % 1,980.00
Net 64,020.00
Cash Disbursement for expenses 16,800.00
Total 80,820.00
Berkleys Auto Alarm Company
Expected Cash Balance
December Amount ($)
Balance As on December 1 28,000.00
Add: Collections from above table 79,080.00
Less : Cash Disbursements during the month 80,820.00
Balance As on December 31 26,260.00
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The following information is from White Mountain Furniture Showroom’s financial records. Month Sales Purchases July $...
The following information is from White Mountain Furniture Showroom’s financial records. Month Sales Purchases July $ 80,000 $ 42,000 August 68,000 47,000 September 67,000 35,000 October 86,000 53,000 Collections from customers are normally 67 percent in the month of sale, 20 percent in the month following the sale, and 11 percent in the second month following the sale. The balance is expected to be uncollectible. All purchases are on account. Management takes full advantage of the 3 percent discount allowed...
The following information is from Tejas WindowTint’s financial records. Month Sales Purchases April $ 81,000 $...
The following information is from Tejas WindowTint’s financial records. Month Sales Purchases April $ 81,000 $ 48,000 May 66,000 44,000 June 63,000 32,000 July 72,000 50,000 Collections from customers are normally 66 percent in the month of sale, 18 percent in the month following the sale, and 14 percent in the second month following the sale. The balance is expected to be uncollectible. All purchases are on account. Management takes full advantage of the 3 percent discount allowed on purchases...
You have been asked to prepare a December cash budget for Ashton Company, a distributor of...
You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company’s operations: The cash balance on December 1 is $58,600. Actual sales for October and November and expected sales for December are as follows: October November December Cash sales $ 73,200 $ 78,000 $ 92,000 Sales on account $ 485,000 $ 568,000 $ 663,000 Sales on account are collected over a three-month period as follows:...
You have been asked to prepare a December cash budget for Ashton Company, a distributor of...
You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company’s operations: a. The cash balance on December 1 is $46,000. b. Actual sales for October and November and expected sales for December are as follows: October November December   Cash sales $ 78,200   $ 77,600   $ 95,000     Sales on account 460,000 534,000   606,000       Sales on account are collected over a three-month period as follows:...
Colter Company prepares monthly cash budgets. Relevant data from operating budgets for 2020 are as follows....
Colter Company prepares monthly cash budgets. Relevant data from operating budgets for 2020 are as follows. January February Sales $ 432,000 $ 480,000 Direct materials purchases 144,000 150,000 Direct labor 108,000 120,000 Manufacturing overhead 84,000 90,000 Selling and administrative expenses 94,800 102,000 All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (60%) of direct...
You have been asked to prepare a December cash budget for Ashton Company, a distributor of...
You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company’s operations: The cash balance on December 1 is $53,400. Actual sales for October and November and expected sales for December are as follows: October November December Cash sales $ 77,000 $ 81,200 $ 87,800 Sales on account $ 435,000 $ 538,000 $ 644,000 Sales on account are collected over a three-month period as follows:...
Lee Company provides the following data for the months of July through October: Month                            
Lee Company provides the following data for the months of July through October: Month                                     Sales                             Purchases July                                         $180,000                      $105,000 August                                    165,000                      120,000 September                             150,000                          90,000 October                                  195,000                      135,000 Collections from customers are normally 70% in the month of sale and 30% in the following month. All purchases are on credit and paid in cash in the following month. November sales are budgeted to be $165,000, and November purchases are forecast to be $150,000. Cash disbursements for expenses in November...
Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit...
Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit customers. OfficeMart estimates that 30% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 20% pay their accounts in the month of sale, while the remaining 80% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows: October $117,000 November 146,000 December 214,000...
Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit...
Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit customers. OfficeMart estimates that 25% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 25% pay their accounts in the month of sale, while the remaining 75% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows: October $107,000 November 134,000 December 196,000...
Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit...
Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit customers. OfficeMart estimates that 20% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 25% pay their accounts in the month of sale, while the remaining 75% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows: October $107,000 November 134,000 December 196,000...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT