The Following Information Is Available for Jergenson Company

question 127

Essay

The following information is available for Jergenson Company:
a. The Cash Budget for March shows a bank loan of $10,000 and an ending cash balance of $48,000.
b. The Sales Budget for March indicates sales of $120,000. Accounts receivable is expected to be 70% of the current-month sales.
c. The Merchandise Purchases Budget indicates that $90,000 in merchandise will be purchased in March on account and ending inventory for March is predicted to be 600 units @ $35. Purchases on account are paid 100% in the month following the purchase.
d. The Budgeted Income Statement shows a net income of $48,000 and $21,000 in income tax expense for the quarter ended March 31. Accrued taxes will be paid in April.
e. The Balance Sheet for February shows equipment of $77,000 with accumulated depreciation of $28,000, common stock of $25,000 and retained earnings of $8,000. There are no changes budgeted in the equipment or common stock accounts.
Prepare a budgeted balance sheet for March.

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Definitions:

Orthopnea

Difficulty breathing when lying down flat; a symptom often associated with heart failure or lung disease, alleviated by sitting or standing up.

Sitting Upright

The posture where the body is aligned vertically while seated, supporting balance and proper organ alignment.

Thoracic Cavity

The body cavity located in the chest, containing the lungs, heart, and other structures.

Abdominal Cavity

The body cavity that houses the major organs of digestion and excretion, located below the chest.