Question

Carter Corporation prepares its master budget on a quarterly basis. The following data have been assembled to assist in preparation of the master budget for the second quarter of 2019: Actual sales for March and budgeted sales for the next four months are as follows: a. March $120,000 150,000 160,000 100,000 110,000 April Мay June July b. The company's gross profit rate is 44 percent of sales. c. Monthly expenses are budgeted as follows: salaries and wages, $12,000 per month; advertising, $15,000 per month; utilities, 2 percent of sales; depreciation, $7,500 per month; other expense, 4 percent of sales; and rent, S17,000 per month. d. At the end of each month, inventory is to be on hand equal to 25 percent of the following month's sales needs, stated at cost. One half of a month's inventory purchases is paid for in the month of purchase; the other half is paid for in the following month. f. Sales are 20 percent for cash and 80 percent on credit. All credit sale terms are n/30; therefore, accounts are collected the month following sale. The accounts receivable at March 31 are a result of March credit sales. g. As of March 31, 2019 (the end of the prior quarter), the company's general ledger showed the following account balances: е. Debits $24,000 86,000 25,000 99,000 Credits Cash Accounts Receivable Inventory Plant and Equip (net) Accounts Payable Capital Stock Retained earnings $50,000 125,000 59,000 $234,000 $234,000 h. During May, the company will purchase a new copy machine for $2,000 cash. During June, other equipment will be purchased for cash at a cost of $20,000. Assume there will be no equipment purchases in April 2019. i. During April, the company will declare and pay $14,000 in cash dividends. Assume no dividends will be paid in May or June of 2019. j. The company must maintain a minimum cash balance of $7,500. An open line of credit is available at a local bank for any borrowing that may be needed during the quarter. All borrowing is done at th beginning of a month, and all repayments are made at the end. Borrowings and repayments of principal must be in multiples of $1,000. Interest is paid at the end of each month. The interest rate is 12 percent per annum. (Figure interest on whole months, e.g., 1/12, 2/12.)

Answer 1

ANSWER

Posted first five parts as per HomeworkLib policy. Please post remaining separately:

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you.
a. Sales Budget		Last year	Current year				Working
			Apr	May	Jun	Total	Jul
Budgeted sales units						-
Budgeted Selling Price						$                            -
Total Sales			150,000	160,000	100,000	410,000	110,000
Cash Sales	20% of Sale		$                        30,000	$                32,000	$                 20,000	$                   82,000
Sales on Account	80% of Sale		$                      120,000	$              128,000	$                 80,000	$                328,000
d. Cash Receipt Budget			Apr	May	Jun	Total	Receivable
Accounts Receivable on Apr 1			$                        86,000			$                   86,000
Credit Sale from:
April				$              120,000		$                120,000
May					$               128,000	$                128,000
June						$                            -	$         80,000
Total Collection from receivable			$                        86,000	$              120,000	$               128,000	$                334,000	$         80,000
Cash Sale			$                        30,000	$                32,000	$                 20,000	$                   82,000
Total Collection			$                      116,000	$              152,000	$               148,000	$                416,000
b. Purchase Budget
			Apr	May	Jun	Total	Jul
Budgeted Cost of Goods Sold	56% of Sale		$                        84,000	$                89,600	$                 56,000	$                229,600	$         61,600
Add: Desired ending inventory	25%		$                        22,400	$                14,000	$                 15,400	$                   15,400
Units available			$                      106,400	$              103,600	$                 71,400	$                245,000
Less: Beginning Inventory			$                      (25,000)	$              (22,400)	$               (14,000)	$                (25,000)
Budgeted Purchase			$                        81,400	$                81,200	$                 57,400	$                220,000
e. Cash Disbursement Budget
			Apr	May	Jun	Total	Payable
Accounts Payable Apr 1			$                        50,000			$                   50,000
Merchandise purchased in:
April			$                        40,700	$                40,700		$                   81,400
May				$                40,600	$                 40,600	$                   81,200
June					$                 28,700	$                   28,700	$         28,700
Total Payment for Purchases of Material			$                        90,700	$                81,300	$                 69,300	$                241,300	$         28,700
c. Monthly Selling and admin Expense Budgets			Apr	May	Jun	Total
Utilities	2% of Sale		$                          3,000	$                  3,200	$                   2,000	$                     8,200
Other Expense	4% of Sale		$                          6,000	$                  6,400	$                   4,000	$                   16,400
Salaries and wages			$                        12,000	$                12,000	$                 12,000	$                   36,000
Advertising			$                        15,000	$                15,000	$                 15,000	$                   45,000
Rent			$                        17,000	$                17,000	$                 17,000	$                   51,000
Depreciation			$                          7,500	$                  7,500	$                   7,500	$                   22,500
Total Budgeted Selling Expense			$                        60,500	$                61,100	$                 57,500	$                179,100

B 1 Please hit LIKE button if this helped. For any furth a. Sales Budget Last year Working Current year Jun Apr May Jul Total =SUM(D5:F5) SF6 110000 20% of Sale 80% of Sale 150000 =D7*20% =D7*80% =D4 86000 160000 =E7*20% =E7*80% =E4 100000 =F7*20% =F7*80% =F4 =SUM(D7:F7) =SUM(D8:F8) =SUM(D9:F9) =G4 =SUM(D11:F11) Receivable 5 Budgeted sales units 6 Budgeted Selling Price 7 Total Sales 8 Cash Sales 9 Sales on Account 10 d. Cash Receipt Budget 11 Accounts Receivable on Apr 1 12 Credit Sale from: 13 April 14 May 15 June 16 17 Total Collection from receivable 18 Cash Sale 19 Total Collection 20 b. Purchase Budget =D9 E9 =SUM(D13:F13) =SUM(D14:F14) =SUM(D15:F15) =F$9*100% =SUM(D11:016) =SUM(E11:E16) =D8 =E8 =SUM(D17:018) -SUM(E17:E18) SUM(F11:F16) =F8 =SUM(F17:F18) =SUM(G11:G16) =SUM(H11:H16) ESUM(D18:F18) =SUM(G17:618) 21 =F4 56% of Sale lo.25 22 Budgeted Cost of Goods Sold 23 Add: Desired ending inventory 24 Units available 25 Less: Beginning Inventory 26 Budgeted Purchase 27 e. Cash Disbursment Budget =D4 -E4 =D7.56% =E756% =E22 $123 =F22 $123 =SUM(D22:D23) =SUM(E22:E23) -25000 =-D23 =SUM(D24:D25) =SUM(E24:E25) =F7*56% =H22*$B23 =SUM(F22:F23) =G4 =H4 -SUM(D22:F22) =H7.56% =F23 =SUM(G22:G23) =D25 =SUM(G24:G25) --E23 =SUM(F24:F25)

27 e. Cash Disbursment Budget =E21 =F21 Payable =D21 50000 =G21 =SUM(D29:F29) =D26/2 29 Accounts Payable Apr 1 30 Merchandise purchased in: 31 April 32 May 33 June 34 Total Payment for Purchases of Material =D26/2 =E26/2 =E32 =F26/2 -SUM(F29:F33) =SUM(D31:F31) =SUM(D32:F32) =SUM(D33:F33) =F33 =SUM(G29:G33) =SUM(H29:H33) =SUM(D29:033) =SUM(E29:E33) 35 =D28 =E28 =F28 =G28 2% of Sale 4% of Sale 36 c. Monthly Selling and admin Expense Budgets 37 38 Utilities 39 Other Expense 40 Salaries and wages 41 Advertising 42 Rent 43 Depreciation 44 45 Total Budgeted Selling Expense =D7*2% =D7*4% 12000 15000 17000 7500 =E7*2% =E7*4% =D40 =D41 =D42 -D43 =F7*2% =F7*4% =E40 =E41 =E42 =E43 =SUM(D38:F38) =SUM(D39:F39) =SUM(D40:F40) =SUM(D41:F41) =SUM(D42:F42) =SUM(D43:F43) =SUM(D38:044) =SUM(E38:E44) =SUM(F38:F44) =SUM(G38:G44) 46