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Jodi Horton, president of the retailer Crestline Products, has just approached the company's bank with a request for a $35,000, 90-day loan. The purpose of the loan is to assist the company in acquiring inventories in support of peak April sales. Because the company has had some difficulty in paying off its loans in the past, the loan officer has asked for a cash budget to help determine whether the loan should be made. The following data are available for the months April-June, during which the loan will be used:
On April 1, the start of the loan period, the cash balance will be $30,000. Accounts receivable on April 1 will total $139,000, of which $132,000 will be collected during April and $5,500 will be collected during May. The remainder will be uncollectible.
Past experience shows that 19% of a month's sales are collected in the month of sale, 75% in the month following sale, and 4% in the second month following sale. The other 2% represents bad debts that are never collected. Budgeted sales and expenses for the three-month period follow:
Merchandise purchases are paid in full during the month following purchase. Accounts payable for merchandise purchases on March 31, which will be paid during April, total $107,000.
In preparing the cash budget, assume that the $35,000 loan will be made in April and repaid in June. Interest on the loan will total $880.
Prepare a schedule of expected cash collections for April, May, and June and for the three months in total. (Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response)
Prepare a cash budget, by month and in total, for the three-month period. (Input all amounts as positive values except cash deficiency, repayments and interest which should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)
Silva Corporation reported net sales of $240,000, $420,000, and $540,000 in the years 2007, 2008, and 2009 respectively. If 2007 is the base year, what is the trend percentage for 2009?
Explain the rules for discharge of indebtedness income. When is it taxable, and when isn't it? Why? Do you think these rules make sense?
Tonya is a cash basis taxpayer. In 2010, she paid state income taxes of $5,000. In early 2011, she filed her 2010 state income tax return and recieved a $500 refund.
In a statement of cash flows, all of the following would be classified as operating activities except:
Calculate the overhead rates per direct-labor hour for the Etching Department and the Finishing Department. Usethe direct method to allocate service department.
nbspnbspnbspnbspcomparative balance sheets for bayshore industries inc. as of december 31 year 2 and year 1 are
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stone inc. is evaluating a project with an initial cost of 8450. cash inflows are expected to be 1000 1000 and 10000 in
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