Question

The following relates to Universal Supplies Co, a wholesale distributor of consumer goods: Selected balances as of December 31: Cash $9,800 Buildings and equipment, net. . $110,885 $ 30,135 Gross margin is 30% of sales b. Actual and budgeted sales data are as follows: $60,000 $70,000 $80,000 December ( actual) C. Sales are 40% cash and 60% credit. Credit sales are collected in the month following sale. d. Each month's ending inventory should be 20% of the next month's budgeted COGS 25% of a month's inventory purchases are paid in the month, the rest is paid the next month. f. Monthly expenses are paid as follows: commissions, $12,000; rent, $1,800; and other expenses, 8% of sales. Depreciation is $ 2,400 for the quarter. g. Equipment will be acquired for cash: $3,000 in January and $ 8,000 in February h. Management wants to maintain at least $5,500 in cash. The company can borrow $1,000 increments at the beginning of each month, to $ 50,000. The simple interest is 1% per month. Any loan plus accumulated interest will be repaid at the end of each quarter if possible Required: For Jan, Feb and March prepare: 1. Schedule of Cash Collections 2. Merchandise Purchase Budget 3. Schedule of Cash Disbursements - Merchandise 7. March 31 Balance Sheet 4. Schedule of Cash Disbursements SG&A 5. Overall Cash Budget 6. Quarterly Income Statement (GAAP basis)

Can someone tell me the process of questions 5,6,7? How can I get those number?

Answer 1

Cash Budget anl March er Cash Balance 6,000.00 6,450.00 6,195.00 6,000.00 $64,000.00 $74,000.00 $82,000.00 $220,000.00 70,000.00 $80,450.00 $88,195.00 $226,000.00 4 Add: Cash Receipts 5 Total Cash Available 6 Cash Disbursements 7 Merchandise Invento 8 Selling and Administrative Expense$19,400.00 $20,200.00 $20,600.00 $ 60,200.00 9 Equipment Acquired 10 Total Cash Disbursements 11 Excess / (Deficit) 12 13 Financing 14 BOITowin 15 Re 16 Interest 17 Total Financin 18 Ending Cash Balance 19 $45,150.00 $51,975.00 $56,350.00$153,475.00 $11,000.00 1,245.001,325.00 $3,000.00 8,000.00 $80,175.00 $76,950.00 $4,000.00 6,000.00 10,000.00 (5,000.00 (5,000.00 S(80.00)$ (160.00) S (240.00 $4,000.00 5,920.00 $ (5,160.00 4,760.00 6,450.00 6,195.00 6,085.00 6,085.00 nent

Balance Sheet Assets Income Statement $235.000.00 $164,500.00 $ 70,500.00 3 Sales 4 Less: Cost of Goods Sold 5 Gross Mar 6 Less: Expenses 7 Selling and Administrative Expense 60,200.00 8 Depreciation Expense 9 Interest Expense 10 Total Expenses 11 Net 12 13 14 15 16 17 18 19 Current Assets Cash Accounts Receivable Invento $6,085.00 S 51,000.00 $ 7,700.00 S 2.400.00 $ 240.00 S 62,840.00 $ 7,660.00 ,Plant and Equipment $119.485.00 $184,270.00 Total Assets rating Incom Liabilties and Stockholder's Equi Current Liabilities Accounts Pavable Loan Pavable S 41.475.00 $ 5,000.00 $100,000.00 $ 37,795.00 Total Liabilities and Stockholders Equity $184,270.00 Common Stock Retained Earnings

Cash Budget anl 6000 64000 March -C18 82000 Quarter 6000 3 Beginning Cash Balance 4 Add: Cash Receipts 5 Total Cash Available 6 Cash Disbursements 7 Merchandise Invento 8 Selling and Administrative Expense 19400 9 Equipment Acquired 10 Total Cash Disbursements 11 Excess / (Deficit 12 13 Financing 14 BOITowin 15 Repayment 16 Interest 17 Total Financing 18 Ending Cash Balance 19 B18 74000 SUMI(B4D4 SUM(B3 :B4) SUM(C3:C4 SUM(D3:D4 SUM(E3:E4 51975 20200 8000 45150 56350 20600 SUM(B7:D7) SUM(B8:D8) SUM(B9:D9 SUM(E7:E9) E5-E10 3000 SUM(B7:B9 B5-B10 SUM(C7:C9 SUM(D7:D9) D5-D10 4000 SUM(B14:D14 SUM(B15:D15 SUM(B16:D16 SUM(B14:B16) -SUM(C14:C16) -SUM(D14:D16) -SUM(E14:E16 6000 -5000 -160 -80 B11+B1'7 -C11+C17 D11+D17 E11+E17