Welnor industrial gas corporation supplies acetylene and


Welnor Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow:

o Sales are budgeted at $320,000 for November, $340,000 for December, and $330,000 for January.

o Collections are expected to be 75% in the month of sale, 20% in the month following the sale, and 5% uncollectible.

o The cost of goods sold is 65% of sales.

o The company desires ending merchandise inventory to equal 80% of the following month's cost of goods sold. Payment for merchandise is made in the month following the purchase.

o Other monthly expenses to be paid in cash are $21,000.

o Monthly depreciation is $16,000.

o Ignore taxes. Required:

a. Prepare a Schedule of Expected Cash Collections for November and December.

b. Prepare a Merchandise Purchases Budget for November and December.

c. Prepare Cash Budgets for November and December.

d. Prepare Budgeted Income Statements for November and December.

e. Prepare a Budgeted Balance Sheet for the end of December.

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Financial Accounting: Welnor industrial gas corporation supplies acetylene and
Reference No:- TGS01069625

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