Exercise 22-17 Merchandising: Budgeted balance sheet LO P2
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The following information is available for Zetrov Company:
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| a. |
The cash budget for March shows an ending bank loan of $10,000 and an ending cash balance of $50,000.
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| b. |
The sales budget for March indicates sales of $140,000. Accounts receivable are expected to be 70% of the current-month sales.
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| c. |
The
merchandise purchases budget indicates that $89,000 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 600 units at a cost of $35 each.
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| d. |
The
budgeted income statement for March shows net income of $48,000.
Depreciation expense of $1,000 and $26,000 in income tax expense were
used in computing net income for March. Accrued taxes will be paid in
April.
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| e. |
The
balance sheet for February shows equipment of $84,000 with accumulated
depreciation of $46,000, common stock of $25,000, and ending retained
earnings of $8,000. There are no changes budgeted in the equipment or
common stock accounts.
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Prepare a budgeted balance sheet for March.
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