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Problem 07-18 Requirement 1: Minden Company: Correct!

The document provides financial budget information for Minden Company for the month of May, including a cash budget, income statement, and balance sheet. The cash budget shows expected cash receipts of $184,000, cash payments of $111,000, and an ending cash balance of $8,900. The income statement budgets for sales of $200,000 and net income of $15,900. The balance sheet budgets inventory to be $40,000 and notes payable to be $20,000, resulting in total assets and liabilities/equity of $330,400.

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265 views3 pages

Problem 07-18 Requirement 1: Minden Company: Correct!

The document provides financial budget information for Minden Company for the month of May, including a cash budget, income statement, and balance sheet. The cash budget shows expected cash receipts of $184,000, cash payments of $111,000, and an ending cash balance of $8,900. The income statement budgets for sales of $200,000 and net income of $15,900. The balance sheet budgets inventory to be $40,000 and notes payable to be $20,000, resulting in total assets and liabilities/equity of $330,400.

Uploaded by

foxstupidfox
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Student Name:

Class:
Problem 07-18
Requirement 1:
MINDEN COMPANY
Schedule of cash receipts:
Cash sales-May
Collections on accounts receivable:
April 30 balance
May sales
Total cash receipts
Schedule of cash payments for purchases:
April 30 accounts payable balance
May purchases
Total cash payments

60,000

54,000
70,000
$
184,000
Correct!
$

63,000
48,000
$
111,000
Correct!

MINDEN COMPANY
Cash Budget
For the Month of May
Cash balance, beginning
Add receipts from customers
Total cash available
Less disbursements:
Purchase of inventory
Selling and administrative expenses
Purchases of equipment
Total cash disbursements
Excess of receipts over disbursements
Financing:
Borrowings-note
Repayments-note
Interest
Total financing
Cash balance, ending

9,000
184,000
193,000
111,000
72,000
6,500
189,500
3,500

20,000
14,500
100
5,400
$
8,900
Correct!

Student Name:
Class:
Problem 07-18

Requirement 2:
MINDEN COMPANY
Budgeted Income Statement
For the Month of May
Sales
Cost of goods sold:
Beginning inventory
Add purchases
Goods available for sale
Ending inventory
Cost of goods sold
Gross margin
Selling and administrative expenses
Net operating income
Interest expense
Net income

$200,000
$30,000
120,000
150,000
(40,000)
110,000
90,000
74,000
16,000
100
$15,900
Correct!

Requirement 3:
MINDEN COMPANY
Budgeted Balance Sheet
May 31
Assets
Cash
Accounts receivable
Inventory
Plant and equipment, net of depreciation
Total assets
Liabilities and Equity
Accounts payable
Note payable
Capital stock
Retained earnings
Total liabilities and equity

$8,900
70,000
40,000
211,500
$330,400

$72,000
20,000
180,000
58,400
$330,400
Correct!

Given Data Problem 07-18:


MINDEN COMPANY
Balance Sheet
April 30
Assets
Cash
Accounts receivable
Inventory
Buildings and equipment, net of depreciation
Total assets

9,000
54,000
30,000
207,000
$ 300,000

Liabilities and Stockholders' Equity


Accounts payable
Note payable
Capital stock, no par
Retained earnings
Total liabilities and stockholders' equity

63,000
14,500
180,000
42,500
$ 300,000

Budgeted Data relating to May:


Budgeted sales
Budgeted sales in cash (remainder credit)
Percent of credit sales collected in same month
Expected inventory purchases during May
Purchases paid for in cash in month purchased
May accounts payable paid in June
Budgeted inventory balance, May 31
Budgeted selling and admin. expenses, May 31
Budgeted depreciation, May 31
Existing note payable paid in May
Interest expense for May
Equipment purchases in May
New note

$ 200,000
$ 60,000
50%
$ 120,000
40%
100%
$ 40,000
$ 72,000
$
2,000
100%
$
100
$
6,500
$ 20,000

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