Note to tutor: budget. due by Apr 21, 11pm, est usa
need to create a budget using the excel template, formulas must be created in the excel sheet
along with detailed information on how the information was obtained. copy/pasta will not be
enough as i actually want to learn how this is done. the more detail the better.
information for the excel sheet can be found in the word document. thank you Capri is a retail company that sells specialized gardening products. The company is considering opening a new store
on October 1, Year1. As budget coordinator, you have been asked to prepare a master budget for the first 3 months
of the company’s operation. You have gathered the following information:
October sales are estimated to be $200000 of which 45 percent will be cash and the remainder will be on credit. The
company expects all sales to increase at the rate of 20 percent per month for November and December. Sales in
January Year 2 are expected to be $220000.
The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month
following the sale.
Prepare a sales budget and a schedule of cash receipts using these facts and your excel template. Check your
answers here before moving to the next part, by completing the cells requested in the chart below.
a. Sales Budget October November December Total-Qtr October November December Total-Qtr Cash sales
Sales on account
Total budgeted sales
b. Schedule of Cash Receipts
Current cash sales
Plus collections from A/R
Total collections The cost of goods sold is 70 percent of sales. The company desires to maintain a minimum ending inventory equal
to 40 percent of the next month’s cost of goods sold. (Ending inventory for December is based on budgeted January
Year2 sales.)
Assume that all inventory purchases are made on account (on credit). The company pays 60 percent of accounts
payable in the month of purchase and the remaining amount in the following month.
In excel, prepare an inventory purchases budget and a cash payments budget for inventory purchases. Use the
check figures below before you continue.
c. Inventory Purchases Budget October November December Total-Qtr Budgeted cost of goods sold
Plus desired ending inventory
Inventory needed
Less beginning inventory
Required purchases (on account)
d. Cash payments for inventory October November December Total-Qtr Payment of current month's A/P
Payment for prior month's A/P
Total budgeted payments Budgeted selling and administrative expenses per month follow. Salary expense (fixed): $ 18700 Sales commissions: 4 percent of Sales Supplies expense: 1 percent of Sales Utilities (fixed): 1600 Depreciation on store equipment (fixed)*: You compute Rent (fixed) $ 8000 Miscellaneous (fixed): $ 940 *The capital expenditures budget indicates that the company will spend $77500 on October 1 for store fixtures, which
are expected to have a $5500 residual value and a 36 month useful life.
Utilities and sales commissions are paid the month after they are incurred; all other expenses are paid in the month in
which they are incurred.
In excel, prepare the selling and administrative expenses budget and the cash payments budget for selling and
administrative expenses. Check the key figures below.
e. Selling and Admin.Expense Budget
Salary expense
Sales commissions
Supplies expense
Utilities
Depreciation on store fixtures October November December Total-Qtr Rent
Miscellaneous
Total S&A expenses
f. Cash payments for S&A
Salary expense October November December Total-Qtr Sales commissions
Supplies expense
Utilities
Depreciation on store fixtures
Rent
Miscellaneous
Total payments for S&A expenses Capri issued stock for 62000 on October 5. A dividend of $31000 was paid on December 15.
The company borrows and repays funds in increments of $1,000 on the last day of the month. The company also
pays its vendors on the last day of the month. It pays interest of 1 percent per month in cash on the last day of the
month. To be prudent, the company desires to maintain a $20000 cash cushion.
Prepare a cash budget on your excel template. Check key figure below.
g. Cash Budget
Beginning cash balance
Issuance of stock
Collections from customers
Cash available
Less payments
For inventory purchases
For S&A expenses
Purchase of store fixtures
Pay dividend
Interest expense
Total budgeted payments
Cash balance before borrow/repay
Financing activity
Borrowing (repayment)
Ending cash balance October November December Total-Qtr

• 1492735605-Budget.docx
• 1492735608-studentBudget 1.xlsx

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Status NEW Posted 21 Apr 2017 12:04 AM My Price 15.00

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