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72.
Which of the following budgets does not require the production budget?
73.
The manufacturing overhead budget requires that costs be separated into their fixed and
variable components. Another budget that has this requirement is the:
74.
Which of the following statements does not reflect a difficulty in preparing the marketing
and administrative budget?
75.
Which of the following types of accounts would not be included on a budgeted balance
sheet?
13-64
76.
77.
Riff, Inc. is working on its cash budget for June. The budgeted beginning cash balance is
$16,000. Budgeted cash receipts total $188,000 and budgeted cash disbursements total
$187,000. The desired ending cash balance is $40,000. The excess (deficiency) of cash
available over disbursements for June will be:
13-67
78.
Center Company makes collections on sales according to the following schedule:
30% in the month of sale
60% in the month following sale
8% in the second month following sale
The following sales are expected:
Expected Sales
January
$100,000
February
$120,000
March
$110,000
79.
Ari, Inc. is working on its cash budget for December. The budgeted beginning cash balance
is $14,000. Budgeted cash receipts total $127,000 and budgeted cash disbursements total
$126,000. The desired ending cash balance is $40,000. To attain its desired ending cash
balance for December, the company needs to borrow:
80.
Which one of the following budgets would be the last one prepared in the master budget
preparation process?
81.
Cash disbursements would not include payments for:
82.
Tennison Corporation had the following transactions in its first year of operations:
Sales(90% collected in year)
$1,500,00
Bad debt write-offs
60,000
Disbursements for costs and expenses
1,200,000
Disbursements for income taxes
90,000
Purchases of fixed assets
400,000
Depreciation of fixed assets
80,000
Proceeds from issuance of common
stock
500,000
Proceeds from short-tem borrowings
100,000
Payments on short-tern borrowings
50,000
What is the cash balance at year end?
83.
84.
85.
86.
Page Company makes 30% of its sales for cash and 70% on account. 60% of the account
sales are collected in the month of sale, 25% in the month following sale, and 12% in the
second month following sale. The remainder is uncollectible. The following information
has been gathered for the current year:
Month
1
2
3
4
Total sales
$60,000
$70,000
$50,000
$30,000
87.
Page Company makes 30% of its sales for cash and 70% on account. 60% of the account
sales are collected in the month of sale, 25% in the month following sale, and 12% in the
second month following sale. The remainder is uncollectible. The following information
has been gathered for Page's first year of operations:
Month
1
2
3
4
Total
sales
$60,000
$70,000
$50,000
$30,000
88.
The Beatrice Manufacturing Company increased its merchandise inventory by $17,000
over the year. The company also granted its customers more liberal credit terms which
increased the accounts receivable by $37,500. Sales were $975,000 and the accounts
payable decreased by $27,500. The gross profit on sales is 45%. Marketing and
administrative expenses were $145,000; this included depreciation expense of $4,000.
What were the cash disbursements for the year?
89.
The Express Company is preparing its cash budget for the month of June. The following
information is available concerning its inventories:
Inventories at beginning of June
$67,500
Estimated purchases of June
330,000
Estimated cost of goods sold for June
337,500
Estimated payments in June for
purchases in May
56,250
Estimated payments in June for
purchases prior to May
15,000
Estimated payments in June for
purchases in June
80%
What are the estimated cash disbursements for inventories in June?
90.
The Overland Company is preparing its cash budget for the month of June. The following
information is available concerning its accounts receivable:
Estimated credit sales for June
$300,000
Actual credit sales for May
225,000
Est. collections in June for credit sales
in June
25%
Est. collections in June for credit sales
in May
65%
Est. collections in June for credit sales
prior to May
$18,000
Est. write-offs in June for uncollectible
credit sales
12,000
Est. provision for bad debts in June for
credit sales in June
10,000
What are the estimated cash receipts from accounts receivable collections in June?
13-79
91.
The Kansas Company is preparing a cash budget for the month of July. The following
information on accounts receivable collections is available from Kansas' past collection
experience:
Percent of current month’s sales collected
this month
15%
Percent of prior month’s sales collected this
month
72%
Percent of sales two months prior to current
month collected this month
6%
Percent of sales three months prior to
current month collected this month
3%
The remaining 4% are not collected and are written off as bad debts.
Credit sales to date are as follows:
July-estimated
$150,000
June
$135,000
May
$120,000
April
$145,000
92.
Kevin Montgomery Retail seeks your assistance to develop cash and other budget
information for May, June, and July. At April 30, the company had cash of $5,500, accounts
receivable of $437,000, inventories of $309,400, and accounts payable of $133,055. The
budget is to be based on the following assumptions:
SALES:
Each month's sales are billed on the last day of the month. Customers are allowed a 3%
discount if payment is made within 10 days after the billing date. Receivables are recorded
in the accounts at their gross amounts (not net of discounts). 55% of the billings are
collected within the discount period; 30% are collected by the end of the month; 9% are
collected by the end of the second month; and 6% turn out to be uncollectible.
PURCHASES:
60% of all purchases of merchandise and the marketing, general, and administrative
expenses are paid in the month purchased and the remainder in the following month. The
number of units in each month's ending inventory is equal to 125% of the next month's
units of sales. The cost of each unit of inventory is $30. Marketing, general, and
administrative expenses, of which $3,000 is depreciation, are equal to 15% of the current
month's sales.
Actual and projected sales are as shown below:
Dollars
Units
March
$472,000
11,800
April
$484,000
12,100
May
$476,000
11,900
June
$456,000
11,400
July
$480,000
12,000
August
$480,000
12,200
What are the budgeted merchandise purchases (in dollars) for May?
