ACC 212 Homework 5

DQ 1: Define Search (in your own words) within the criminal justice context. Give an example of seizure, within the criminal justice context. What is meant by “reasonableness” in the context of searches, seizures and arrests?
September 12, 2019
Mark 8:29 Worksheet
September 12, 2019

ACC 212 Homework 5

Exercise 22-7 Merchandising: Computing budgeted accounts payable and purchases%u2014sales forecast in dollars LO P1, P2

Big Sound, a merchandising company specializing in home computer speakers, budgets its monthly cost of goods sold to equal 60% of sales. Its inventory policy calls for ending inventory in each month to equal 30% of the next month’s budgeted cost of goods sold. All purchases are on credit, and 40% of the purchases in a month is paid for in the same month. Another 20% is paid for during the first month after purchase, and the remaining 40% is paid for in the second month after purchase. The following sales budgets are set: July, $200,000; August, $140,000; September, $170,000; October, $125,000; and November, $115,000.

Exercise 22-9A Manufacturing: Direct materials budget LO P3

Electro Company manufactures an innovative automobile transmission for electric cars. Management predicts that ending finished goods inventory for the first quarter will be 71,280 units. The following unit sales of the transmissions are expected during the rest of the year: second quarter, 216,000 units; third quarter, 496,000 units; and fourth quarter, 250,000 units. Company policy calls for the ending finished goods inventory of a quarter to equal 33% of the next quarter’s budgeted sales. (Ending inventory for the first quarter does not comply with company policy.) Each transmission requires 0.69 pounds of a key raw material. Electro Company aims to end each quarter with an ending inventory of direct materials equal to 33% of next quarter’s budgeted materials requirements. Direct materials cost $183 per unit.

Prepare a direct materials budget for the second quarter.

Exercise 22-12 Budgeted cash receipts LO P1

Jasper Company has sales on account and for cash. Specifically, 55% of its sales are on account and 45% are for cash. Credit sales are collected in full in the month following the sale. The company forecasts sales of $519,000 for April, $529,000 for May, and $554,000 for June. The beginning balance of Accounts Receivable is $304,500 on April 1.

Prepare a schedule of budgeted cash receipts for April, May, and June.

Exercise 22-13 Cash budget LO P1

Karim Corp. requires a minimum $10,000 cash balance. If necessary, loans are taken to meet this requirement at a cost of 1% interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash balance on July 1 is $10,400 and the company has no outstanding loans. Forecasted cash receipts (other than for loans received) and forecasted cash payments (other than for loan or interest payments) are:

July

August

September

Cash receipts

$

26,000

$

34,000

$

42,000

Cash disbursements

31,000

32,000

34,000

Prepare a cash budget for July, August, and September.

Exercise 22-14 Cash budget LO P1

Foyert Corp. requires a minimum $6,100 cash balance. If necessary, loans are taken to meet this requirement at a cost of 2% interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash balance on October 1 is $6,100 and the company has an outstanding loan of $2,100. Forecasted cash receipts (other than for loans received) and forecasted cash payments (other than for loan or interest payments) follow.

October

November

December

Cash receipts

$

22,100

$

16,100

$

20,100

Cash disbursements

24,150

15,100

15,900

Prepare a cash budget for October, November, and December

Exercise 22-15 Merchandising: Cash budget LO P1

Castor, Inc. is preparing its master budget for the quarter ended June 30. Budgeted sales and cash payments for merchandise for the next three months follow:

April

May

June

Budgeted sales

$

31,500

$

40,500

$

24,500

Budgeted cash payments for merchandise

21,200

16,300

16,700

Sales are 60% cash and 40% on credit. All credit sales are collected in the month following the sale. The March 30 balance sheet includes balances of $12,500 in cash, $12,500 in accounts receivable, $11,000 in accounts payable, and a $2,500 balance in loans payable. A minimum cash balance of $12,500 is required. Loans are obtained at the end of any month when a cash shortage occurs. Interest is 2% per month based on the beginning of the month loan balance and is paid at each month-end. If an excess balance of cash exists, loans are repaid at the end of the month. Operating expenses are paid in the month incurred and consist of sales commissions (5% of sales), shipping (4% of sales), office salaries ($3,500 per month) and rent ($5,500 per month).

Prepare a cash budget for each of the months of April, May, and June.

Exercise 22-17 Merchandising: Budgeted balance sheet LO P2

The following information is available for Zetrov Company:

a.

The cash budget for March shows an ending bank loan of $15,000 and an ending cash balance of $61,000.

b.

The sales budget for March indicates sales of $130,000. Accounts receivable are expected to be 65% of the current-month sales.

c.

The merchandise purchases budget indicates that $90,000 in merchandise will be purchased on account in March. Purchases on account are paid 100% in the month following the purchase. Ending inventory for March is predicted to be 700 units at a cost of $35 each.

d.

The budgeted income statement for March shows net income of $49,000. Depreciation expense of $2,000 and $27,000 in income tax expense were used in computing net income for March. Accrued taxes will be paid in April.

e.

The balance sheet for February shows equipment of $83,000 with accumulated depreciation of $31,000, common stock of $30,000, and ending retained earnings of $9,000. There are no changes budgeted in the equipment or common stock accounts.

Prepare a budgeted balance sheet for March.

Exercise 22-18 Merchandising: Budgeted income statement LO P2

Fortune, Inc., is preparing its master budget for the first quarter. The company sells a single product at a price of $25 per unit. Sales (in units) are forecasted at 40,000 for January, 60,000 for February, and 50,000 for March. Cost of goods sold is $12 per unit. Other expense information for the first quarter follows.

Commissions

9

%

of sales

Rent

$

18,000

per month

Advertising

15

%

of sales

Office salaries

$

76,000

per month

Depreciation

$

49,000

per month

Interest

12

%

annually on a $230,000 note payable

Tax rate

30

%

Prepare a budgeted income statement for this first quarter.

Exercise 22-19A Manufacturing: Direct labor budget LO P3

The production budget for Manner Company shows units to be produced as follows: July, 600; August, 660; September, 520. Each unit produced requires two hours of direct labor. The direct labor rate is currently $15 per hour but is predicted to be $15.75 per hour in September.

Prepare a direct labor budget for the months July, August, and September. (Round your “Labor rate” to 2 decimal places.)

Exercise 22-20A Manufacturing: Production budget LO P3

Hospitable Co. provides the following sales forecast for the next four months:

April

May

June

July

Sales (units)

690

770

720

720

The company wants to end each month with ending finished goods inventory equal to 20% of next month’s sales. Finished goods inventory on April 1 is 138 units. Assume July’s budgeted production is 730 units.

Exercise 22-21A Direct materials budget LO P3

Hospitable Co. provides the following sales forecast for the next four months:

April

May

June

July

Sales (units)

580

660

610

610

The company wants to end each month with ending finished goods inventory equal to 20% of next month’s sales. Finished goods inventory on April 1 is 116 units. Assume July’s budgeted production is 620 units. Assume each finished unit requires five pounds of raw materials and the company wants to end each month with raw materials inventory equal to 20% of next month’s production needs. Beginning raw materials inventory for April was 596 pounds.

Prepare a direct materials budget for April, May, and June.


 

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