Solutions -- Week 11

Solutions -- Week 11 - WEEK CLS DATES [M-W] 11 DATES [T-Th]...

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GNB Problem Solutions – Week-by-Week page 1 of 9 WEEK 11 GNB ASSIGNED PROBLEM SOLUTIONS BUAD 250B – FALL 2009 CLS DATES [M-W] DATES [T-Th] TOPICS READINGS ASSIGNMENTS [TO BE COMPLETED BY DATE ASSIGNED] 20 Nov 2 Nov 3 Profit Planning Flexible Budgeting & Performance Analysis Ch. 10 BE: 10-1, 2, 3, 4, 5, 6 PR: 9-21 In-class: 10-18 Intro: Ch. 10 21 Nov 4 Nov 5 Flexible Budgeting Ch. 10 PR: 10-8, 9, 10, 11, 12 (all related) In-class: 10-22 Intro: Ch. 11 Problem 9-21 1. Schedule of expected cash collections: Month April May June Quarter From accounts receivable . .............. $120,000 $ 16,000 $136,000 From April sales: 30% × $300,000 . .......................... 90,000 90,000 60% × $300,000 . .......................... 180,000 180,000 8% × $300,000 . ............................ $ 24,000 24,000 From May sales: 30% × $400,000 . .......................... 120,000 120,000 60% × $400,000 . .......................... 240,000 240,000 From June sales: 30% × $250,000 . .......................... 75,000 75,000 Total cash collections . ...................... $210,000 $316,000 $339,000 $865,000 2. Cash budget: Month April May June Quarter Cash balance, beginning . ............. $ 24,000 $ 22,000 $ 26,000 $ 24,000 Add receipts: Collections from customers . ..... 210,000 316,000 339,000 865,000 Total available . .............................. 234,000 338,000 365,000 889,000 Less disbursements: Merchandise purchases . ........... 140,000 210,000 160,000 510,000 Payroll . ...................................... 20,000 20,000 18,000 58,000 Lease payments . ...................... 22,000 22,000 22,000 66,000 Advertising . ............................... 60,000 60,000 50,000 170,000 Equipment purchases . .............. 65,000 65,000 Total disbursements . ..................... 242,000 312,000 315,000 869,000 Excess (deficiency) of receipts over disbursements . ................. (8,000 ) 26,000 50,000 20,000 Financing: Borrowings . ............................... 30,000 30,000 Repayments . ............................. (30,000) (30,000) Interest . ..................................... (1,200 ) (1,200 ) Total financing . .............................. 30,000 (31,200 ) (1,200 ) Cash balance, ending . .................. $ 22,000 $ 26,000 $ 18,800 $ 18,800 3. If the company needs a minimum cash balance of $20,000 to start each month, the loan cannot be repaid in full by June 30. Some portion of the loan balance will have to be carried over to July.
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GNB Problem Solutions – Week-by-Week page 2 of 9 Exercise 10-1 Puget Sound Divers Flexible Budget For the Month Ended May 31 Actual diving-hours . .................................................................... 105 Revenue ($365.00q) . .................................................................. $38,325 Expenses: Wages and salaries ($8,000 + $125.00q). .............................. 21,125 Supplies ($3.00q) . ................................................................... 315 Equipment rental ($1,800 + $32.00q) .
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This note was uploaded on 11/14/2010 for the course BUAD 250B taught by Professor Jackson during the Spring '07 term at USC.

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Solutions -- Week 11 - WEEK CLS DATES [M-W] 11 DATES [T-Th]...

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