CHAPTER 7
COVERAGE OF LEARNING OBJECTIVES
LEARNING OBJECTIVE LO1: Explain how budgets facilitate planning and coordination. LO2: Anticipate possible human relations problems caused by budgets. LO3: Explain potentially dysfunctional incentives in the budget process. LO4: Explain the difficulties of sales forecasting. LO5: Explain the major features and advantages of a master budget. LO6: Follow the principal steps in preparing a master budget. LO7: Prepare the operating budget and the supporting schedules. LO8: Prepare the financial budget. LO9: Use a spreadsheet to develop a budget (Appendix 7). CRITICAL FUNDA- THINKING MENTAL EXERCISES ASSIGNMENT AND MATERIAL EXERCISES A1,B1 PROBLEMS CASES, EXCEL, COLLAB. & INTERNET EXERCISES 25 40 22 39, 40 23 42 49 A1,B1 24,26 39 A1,B1 29 40 43,45 A1,B1 28,29,30,31 40 43,45,46,48 A1,B1 27,29,32,33, 34,35 36,37,38 41,42 43,44,47,48
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CHAPTER 7
Introduction to Budgets and Preparing the Master Budget
7-A1 (60-90 min.) 1.
Exhibit I
RAPIDBUY ELECTRONICS, INC.
Mall of America Store Budgeted Income Statement
For the Three Months Ending August 31, 20X8
Sales
Cost of goods sold (.62 × $300,000) Gross profit
Operating expenses:
Salaries, wages, commissions $60,000 Other expenses 12,000 Depreciation
1,500 Rent, taxes and other fixed expenses 33,000 Income from operations. Interest expense* Net income
* See schedule g for calculation of interest.
Copyright ?2011 Pearson Education, Inc., Publishing as Prentice Hall. $300,000 186,000 $114,000
106,500 $ 7,500 1,338 $ 6,162 273
Exhibit II
RAPIDBUY ELECTRONICS, INC.
Mall of America Store
Cash Budget
For the Three Months Ending August 31, 20X8
June July Beginning cash balance
$ 5,800 $ 5,600 Minimum cash balance desired 5,000 5,000 (a) Available cash balance
$ 800 $ 600 Cash receipts & disbursements: Collections from customers (schedule b)
$ 75,200 $121,400 Payments for merchandise (schedule d)
(86,800) (49,600) Fixtures (purchased in May) (11,000) - Payments for operating expenses (schedule f) (44,600) (30,200) (b) Net cash receipts & disbursements
$(67,200) $ 41,600 Excess (deficiency) of cash before financing (a + b) (66,400) 42,200 Financing:
Borrowing, at beginning of period $ 67,000
$ - Repayment, at end of period - (41,000)
Interest, 10% per annum - (1,121)*(c) Total cash increase (decrease) from financing
$ 67,000 $(42,121) (d) Ending cash balance (beginning balance + b + c) $ 5,600 $ 5,079
* See schedule g
Copyright ?2011 Pearson Education, Inc., Publishing as Prentice Hall. August $ 5,079 5,000 $ 79
$ 90,800 (49,600)
- (30,200) $ 11,000 11,079
$ - (10,000) (217)* $(10,217) $ 5,862 273
Exhibit III
RAPIDBUY ELECTRONICS, INC.
Mall of America Store Budgeted Balance Sheet August 31, 20X8
Assets Liabilities and Owners’ Equity Cash (Exhibit II) $ 5,862 Accounts payable $ 37,200 Accounts receivable* 86,400 Notes payable 16,000** Merchandise inventory 37,200 Total current liabilities $ 53,200 Total current assets $129,462 Net fixed assets: Owners' equity: $33,600 less $102,200 plus net depreciation of $1,500 32,100 income of $6,162 108,362 Total assets $161,562 Total equities $161,562
*July sales, 20% × 90% × $80,000 $ 14,400 August sales, 100% × 90% × $80,000 72,000 Accounts receivable $86,400 ** See schedule g June July August Total Schedule a: Sales Budget Credit sales (90%) $126,000 $72,000 $72,000 $270,000 Cash sales (10%) 14,000 8,000 8,000 30,000 Total sales (to Exhibit I) $140,000 $80,000 $80,000 $300,000 Schedule b: Cash Collections June July August Cash sales $ 14,000 $ 8,000 $ 8,000 On accounts receivable from: April sales 10,800 - - May sales 50,400 12,600 - June sales - 100,800 25,200 July sales - - 57,600 Total collections (to Exhibit II) $75,200 $121,400 $90,800
Schedule c: Purchases Budget May Desired purchases: 62% × next month's sales $86,800 Schedule d: Disbursements for PurchasesJune Last month's purchases (to Exhibit II)
June $49,600 July $86,800
July $49,600 August $49,600
August $37,200 $49,600
Copyright ?2011 Pearson Education, Inc., Publishing as Prentice Hall. 273
Other required items related to purchases Accounts payable, August 31, 2008 (62% × September sales - to Exhibit III) $37,200 Cost of goods sold (to Exhibit I) $86,800 $49,600 $49,600
Schedule e: Operating Expense Budget June July August Total Salaries, wages, commissions $28,000 $16,000 $16,000 $60,000 Other Variable expenses 5,600 3,200 3,200 12,000 Fixed expenses 11,000 11,000 11,000 33,000 Depreciation 500 500 500 1,500 Total operating expenses $45,100 $30,700 $30,700 $106,500
Schedule f: Payments for Operating Expenses June July August Variable expenses $33,600 $19,200 $19,200 Fixed expenses 11,000 11,000 11,000 Total payments for operating expenses $44,600 $30,200 $30,200
Schedule g: Interest calculations June July August Beginning balance $67,000 $67,558 $26,000 Monthly interest expense @ 10% 558 563 217 Ending balance before repayment $67,558 68,121 26,217 Principal repayment (from
statement of receipts and disbursements) (41,000) (10,000) Interest payment (1,121) (217) Ending balance $26,000 $16,000
2. This is an example of the classic short-term, self-liquidating loan. The need for such a loan often arises because of the seasonal nature of a business. The basic source of cash is proceeds from sales to customers. In times of peak sales, there is a lag
between the sale and the collection of the cash, yet the payroll and suppliers must be paid in cash right away. When the cash is collected, it in turn may be used to repay the loan. The amount of the loan and the timing of the repayment are heavily
dependent on the credit terms that pertain to both the purchasing and selling functions of the business.
Copyright ?2011 Pearson Education, Inc., Publishing as Prentice Hall. 273
亨格瑞管理会计英文第15版练习答案07解析
