Reference no: EM132584465

Weltin Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow:

1. Sales are budgeted at $390,000 for November, $370,000 for December, and $380,000 for January.
2. Collections are expected to be 90% in the month of sale, 5% in the month following the sale, and 5% uncollectible.
3. The cost of goods sold is 60% of sales.
4. The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase.
5. Other monthly expenses to be paid in cash are $21,800.
6. Monthly depreciation is $18,000.

Ignore taxes.

Statement of Financial Position October 31
Assets

Cash                                                            $ 25,000
Accounts receivable (net of allowance for
uncollectible accounts)                                    71,000
Inventory                                                         163,800
Property, plant and equipment (net of
$504,000 accumulated depreciation)                   1,088,000
Total assets                                                     $1,347.80
Liabilities and Stockholders' Equity
Accounts payable                                           $ 232,000
Common stock                                                   700,000
Retained earnings                                            415,800
Total liabilities and stockholders' equity ;               1,347,800

Required:

Question a) Prepare Schedule of Expected Cash Collections for November and December.

Question b) Prepare Merchandise Purchases Budget for November and December.

Question c) Prepare Cash Budgets for November and December.

Question d) Prepare Budgeted Income Statements for November and December.

Question e) Prepare Budgeted Balance Sheet for the end of December.