How compute the cash balance at the end of the month

Assignment Help Cost Accounting
Reference no: EM132596363

A company had a cash balance of $3,500 at the beginning of the month. The company does not make any sales on credit. The company accepts cash and credit cards. Assume that 80% of its sales are credit card sales, for which cash is received right away, less a 2% transaction fee. Total sales for the month was $350,000. Materials are purchased on account. The company pays for half of the purchases in the current month and the other half the following month. Suppliers for materials are owed $5,000 from the previous month. Purchases of materials for the current month total $40,000. Depreciation expense for the month total $7,500. Sales commissions of 10% of gross sales are paid in the current month. Labor costs for the month total $50,000 which will be paid in the current month. The company has a $100,000 loan with a 12% annual rate of interest. Interest is paid at the end of the month, and the entire principal will be paid back at the end of the month if the company has excess cash. The company desires a minimum ending cash balance of $25,000.

Question 1: Compute the cash balance at the end of the month.

Reference no: EM132596363

Questions Cloud

Does the message fit gender-role stereotype : What examples are used to convey this message? Does the message fit a gender-role stereotype? Why? Is gender message consistent with your beliefs about gender.
What is the required investment : a. What is the required investment, that is, the Year 0 project cash flow? b. What are the annual depreciation charges?
Determine the reversal of impairment loss : Determine the reversal of impairment loss that should be credited in profit or loss account as at 1 January 2019
How can we make sure security is implemented into the design : In today's fast-paced, agile software development environment, how can we make sure security is implemented into the design? What are some of the key strategies
How compute the cash balance at the end of the month : Compute the cash balance at the end of the month. A company had a cash balance of $3,500 at the beginning of the month. The company does not make any sales
Prepare the journal entry regarding the purchase : Prepare the journal entry regarding the purchase and retirement of the own shares on March 1, 2019 and Calculate purchases of silver powder in 2019
Business liabilities arise : Business liabilities arise from the day to day business operations that come in the form of traditional financial obligations owed to other people or businesses
How can a healthcare organization improve : How can a healthcare organization improve its revenue cycle management?
Compute the minimum number of bottles : The ending inventory for bottled water should be no less than 72,000 bottles of water. Compute the minimum number of bottles that should be produced for year

Reviews

Write a Review

Cost Accounting Questions & Answers

  Evaluating the purpose of variance analysis

Prepare a budget showing purchases, cost of goods sold and inventory for the nine months ended 30 September - Write a business report describing budgeting as a non-technical process

  Determine participation in the years net income

Determine participation in the years net income of $420,000 under each of the following independent assumptions:

  Are the kiosks mostly a fixed cost or a variable cost

Are the kiosks mostly a fixed cost or a variable cost? Explain. Would an employee taking orders at the counter be considered to be a fixed cost or a variable cost? Explain.

  Calculate the balance of work-in-process inventory

Calculate the total amount by which manufacturing overheads were over or underallocated for the month of February - Calculate the balance of Work-in-process Inventory as at 1 April.

  Identify whether you should reduce variable or fixed costs

Calculate an overhead absorption rate for each process, the actual processing hours worked 3,500, whilst the actual overheads incurred

  Evaluate benefits of using historical cost accounting

Evaluate the benefits and challenges of using historical cost and fair value accounting for PPE and intangibles, by reviewing accounting literature.

  Compute overhead rates using activity-based costing approach

Compute the overhead rates using the activity-based costing approach and determine the difference in allocation between the two approaches.

  Prepare a schedule of the expected manufacturing costs

Nicholson expects to produce 20,000 units during the next period. Prepare a schedule of the expected manufacturing costs.

  What are benefits of abc that relate to financial services

What are some of the benefits of ABC that relate to the financial services industry? What are three things that the company's original costing method did not take into account?

  Compute the cost of goods destroyed

Zidek Corp. requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $38,000. Purchases since January 1 were $92,000.

  Why the owner assumption that total unit cost

Explain why the owner's assumption that "total unit cost (including all appropriate resources) is proportional to direct materials cost" is not a safe assumptio

  Find costs of ordering for each of the annual orders

Prepare a table like Exhibit 7.14. Find the costs of ordering and carrying inventory for each of the following number of annual orders: 40 orders, 50 orders, 60 orders.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd