18 Mar Minden Company is a wholesale distributor of premi
Minden Company is a wholesale distributor of premium European chocolates. It buys and sells the chocolate per box.The company’s balance sheet as of April 30 is given below: Minden CompanyBalance SheetMarch 31(in Bhd) Assets Cash 9,000 Accounts receivable 54,000 Inventory 0 Buildings and equipment, net of depreciation 207,000 Total assets 270,000 Liabilities and Stockholders’ Equity Accounts payable 63,000 Note payable 14,500 Common stock 180,000 Retained earnings 12,500 Total liabilities and stockholders’ equity 270,000The company is in the process of preparing a budget forApril to Juneand has assembled the following data.a.Based on historical data,selling price perbox is Bhd110.Thepremium European chocolatescostperbox is Bhd100and monthlyfixed expenses of Bhd5,000.00.Using the break-even in units, the management intends to sell50%morefrom the break-even inunits in themonth of Apriland there will an 20% increaseevery month thereafter. The increase will be based on the previous month.b. The collection pattern isas follows: 50% collected on the month of sale30% collected on the following month of salesAnd the remaining will be on the second month of sale.All of theMarch 31 accounts receivable will be collected inApril.c. Thedesired ending inventory is 10% of the next month sales.These purchases will all be on account.Forty percent(40%) of all purchases are paid for in the month of purchase; theremainder are paid in the following month.All of theMarch 31 accounts payable to suppliers will be paid during April. There is no beginning inventory as of March 31.d.Selling and administrative expenses is estimated to be5% of the gross sales and these expenses will be paid in cash.e.The note payable on theMarch 31 balance sheet will be paid duringApril, withBhd100 in interest. (All of the interest relates to April.)f.New refrigerating equipment costingBhd6,500 will be purchased for cash during May.g.Thecompany will borrowinApril 30,000 and in June, 20,000from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year.h.Depreciation expense for the month is 1,000.i. There is nodividend paid for the monthRequired:?Part 1.Determine the break-even in boxes( 3marks)????Part II.Prepare the following schedules:(5 marks each x5 = 25 marks)Marking Scheme: 2 marks – computation ; 2 marks – analysis ; 1 mark – presentation a)Schedule 1. Projected Sales Budget?????b)Schedule 2. Collection Schedule??????c)Schedule 3. Purchases Schedule ofPremium European Chocolates inboxes and amount?????????d)Schedule 4.Payment Schedule for the Purchases ofPremium European Chocolatese)Schedule 5. Cash Budget SchedulePart III.Determine the following:(25 marks)?Marking Scheme:1 mark -theoretical understanding ; 2 marks -computation; 2 marks -analysisa)Note 1. Accounts Receivable, end (5 marks)b)Note 2. Inventory, end (5 marks)c)Note 3. Buildings and Equipment, end (5 marks)d)Note 4. Accounts Payable, end (5 marks)e)Note 5. Notes Payable, end (5 marks)Part IV.Prepare the following:Marking Scheme:2/4 marks -analysis ; 2/4 marks -presentation; 1/2mark-completeness of dataa.Budgeted Income Statement for the period ending June 30.(10 marks)b.Projected Statement of Retained Earnings, end(5 marks)c.Projected Balance Sheet as of June 30.(10 marks)?Additional Information:Assuming that onJune 30, the following financial informations were given to you for the analysis of the variances incurred.SalesInformation Actual Number of Boxes Sold 2,700 Selling Price per box 100For sales budgeted information, refer to Schedule 1. Projected Sales Budget.PurchasesInformation Actual Number of Boxes Sold 2,800 Selling Price per box 95For purchases budgeted information, refer to Schedule 3.Purchases Schedule ofPremium European Chocolates in boxes and amount??Part V.Determine the following variances and evaluate the variances ( 2 marks each x 6 = 12)Marking Scheme: 1 mark – analysis; 1 mark – presentationa. Quantity Sold Varianceb. Selling Price Variancec. Sales Variancee. Quantity Purchase Variancef. Purchase Price Varianceg. Purchase Variance?
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