Question

Required: Prepare a master budget for the three-month period ending June 30. Include the following detailed schedules: 1. a. A sales budget, by month and in total. b. A schedule of expected cash collections, by month and in total. c. A merchandise purchases budget in units and in dollars. Show the budget by month and in total. d. A schedule of expected cash disbursements for merchandise purchases, by month and in total. 2. A cash budget. Show the budget by month and in total. Determine any borrowing that would be needed to maintain the minimum cash balance of $62,000. 3. A budgeted income statement for the three-month period ending June 30. Use the contribution approach. 4. A budgeted balance sheet as of June 30. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1C Req 1D Req 2 Req3 Req 4 Prepare a master budget for the three-month period ending June 30 that includes a sales budget, by month and in total. Sales Budget April May June Quarter Budgeted unit sales Selling price per unit Total sales < Req1A Req 1B >

Answer 1

Solution 1a:

Sales Budget - Earrings Unlimited
Particulars	April	May	June	Total
Budgeted Sales units	67400	102400	52400	222200
Selling price per unit	$16.00	$16.00	$16.00	$16.00
Total Sales	$1,078,400.00	$1,638,400.00	$838,400.00	$3,555,200.00

Solution 1b:

Schedule of expected cash collection - Earrings Unlimited
Particulars	April	May	June	Total
Cash received for Feburary Sale	$45,440.00			$45,440.00
Cash received for March Sale	$474,880.00	$67,840.00		$542,720.00
Cash received for April Sale	$215,680.00	$754,880.00	$107,840.00	$1,078,400.00
Cash received for May Sale		$327,680.00	$1,146,880.00	$1,474,560.00
Cash received for June Sale			$167,680.00	$167,680.00
Budgeted Cash Collection	$736,000.00	$1,150,400.00	$1,422,400.00	$3,308,800.00

Solution 1c:

Merchandise Purchase Budget - Earrings Unlimited
Particulars	April	May	June	Total
Sales units	67400	102400	52400	222200
Add: Desired ending inventory (40% of next month sales)	40960	20960	12960	12960
Total needs	108360	123360	65360	235160
Less: Opening Inventory	26960	40960	20960	26960
Estimated purchase for earrings (In pairs)	81400	82400	44400	208200
Cost per pair	$5.20	$5.20	$5.20	$5.20
Budgeted purchases (in dollars)	$423,280.00	$428,480.00	$230,880.00	$1,082,640.00

Solution 1d:

Budgeted Cash disbursement for merchandise purchases - Earrings Unlimited
Particulars	April	May	June	Total
Accounts Payable	$112,000.00			$112,000.00
April Purchases	$211,640.00	$211,640.00		$423,280.00
May Purchases		$214,240.00	$214,240.00	$428,480.00
June Purchases			$115,440.00	$115,440.00
Total cash payments	$323,640.00	$425,880.00	$329,680.00	$1,079,200.00

Note: I have answered first 4 parts of the question as HOMEWORKLIB RULES policy, kindly post separate question for answer of remaining parts.