Question

Required information Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet (LO8-2, LO8-4, LO8-9, LO8-10] [The following information applies to the questions displayed below.] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: Beech Corporation Balance Sheet June 30 Assets Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 73,000 125,000 56,000 221,000 $ 475,000 $ 82,000 309,000 84,000 $ 475,000

Answer 1

Solution 1, 2a and 2b:

Schedule of expected cash collection - Beech Corporation
Particulars	July	August	September	Total
Accounts Receivables from June	$1,25,000.00			$1,25,000.00
Cash received for July Sale	$1,12,000.00	$2,08,000.00		$3,20,000.00
Cash received for August Sale		$1,19,000.00	$2,21,000.00	$3,40,000.00
Cash received for September Sale			$1,15,500.00	$1,15,500.00
Budgeted Cash Collection	$2,37,000.00	$3,27,000.00	$3,36,500.00	$9,00,500.00
Material Purchase Budget - Beech Corporation
Particulars	July	August	September	Total
Budgeted Sales	$3,20,000.00	$3,40,000.00	$3,30,000.00	$9,90,000.00
Cost of Sales (70% of Sales)	$2,24,000.00	$2,38,000.00	$2,31,000.00	$6,93,000.00
Add: Desired ending inventory (25% of COGS of next month)	$59,500.00	$57,750.00	$61,250.00	$61,250.00
Less: Opening Inventory	$56,000.00	$59,500.00	$57,750.00	$56,000.00
Budgeted purchases (in dollars)	$2,27,500.00	$2,36,250.00	$2,34,500.00	$6,98,250.00
Schedule of expected cash disbursement for merchandise purchases - Beech Corporation
Particulars	July	August	September	Total
Payables from June	$82,000.00			$82,000.00
July Purchases	$91,000.00	$1,36,500.00		$2,27,500.00
August Purchases		$94,500.00	$1,41,750.00	$2,36,250.00
September Purchases			$93,800.00	$93,800.00
Total payments in month	$1,73,000.00	$2,31,000.00	$2,35,550.00	$6,39,550.00

Solution 3 and 4:

Income Statement - Beech Corporation
For Quarter Ended - September 30
Particulars	Amount
Sales	$9,90,000.00
Cost of Sales	$6,93,000.00
Gross Profit	$2,97,000.00
Operating Expenses:
Selling and adminstrative expenses (40000*3)	$1,20,000.00
Net Income	$1,77,000.00
Balance Sheet- Beech Corporation
30-Sep
Particulars	Amount
Assets:
Cash ($73,000 + $900500 - $639550 - $34000*3)	$2,31,950.00
Accounts receivables ($330,000*65%)	$2,14,500.00
Inventory	$61,250.00
Plant and equipment net of depreciation ($221,000 - $6,000*3)	$2,03,000.00
Total Assets	$7,10,700.00
Liabilities and stockholder's Equity:
Accounts payable ($234500*60%)	$1,40,700.00
Common Stock	$3,09,000.00
Retained Earnings ($84000 + $177,000)	$2,61,000.00
Total liabilities and stockholders equity	$7,10,700.00