Virginia Jackson is opening Jackson Realty on January 2. For several weeks she has been busy putting together an operating budget for the first quarter of operations for her new business. Virginia has estimated her selling and administrative (S&A) costs as follows:?JanuaryFebruaryMarchDepreciation$ 1,000$ 1,000$ 1,000Marketing expenses2,0001,4001,000Miscellaneous costs500400400Rent expense5,0005,0005,000Salary expense4,0008,0008,000Sales commissions1,0001,2001,400Utilities expense 1,000 800 1,000Total S&A costs before interest$ 14,500$ 17,800$ 17,800All selling and administrative costs are paid when incurred except utilities, marketing expenses, and sales commissions. These items are paid in the
month following the month incurred.Required:1) Prepare a schedule of cash payments for selling and administrative expenses for January through March.2) What liabilities, in what amounts, would be reported on the pro forma balance sheet as of March 31?
What will be an ideal response?
Answers will vary
1) Schedule of cash payments for selling and administrative expenses:
| ? | January | February | March |
| Marketing expenses | - | 2,000 | 1,400 |
| Miscellaneous costs | 500 | 400 | 400 |
| Rent expense | 5,000 | 5,000 | 5,000 |
| Salary expense | 4,000 | 8,000 | 8,000 |
| Sales commissions | - | 1,000 | 1,200 |
| Utilities expense | - | 1,000 | 800 |
| Total S&A costs before interest | $ 9,500 | $ 17,400 | $ 16,800 |
2) Utilities payable on March 31: $1,000
Sales commissions payable on March 31: $1,400
Marketing expenses payable on March 31: $1,000
You might also like to view...
Ethical wrong is done either by intending to deceive consumers in order to manipulate their buying behavior, treating them as a mere means to one's own ends (the Kantian approach) or by the harmful consequences for consumers, competitors and overall market efficiency (the utilitarian approach) but not by both.
Answer the following statement true (T) or false (F)
In a push manufacturing system, ______.
a. demand is forecast using historical data b. demand is forecast using future trends c. production is based on actual customer demand d. production is based on government regulations
If you compute an interval with a 99% confidence level, this means that 99% of sample means drawn from the population will be…
a. important b. accurate c. between the bounds d. greater than zero
The plaintiff, in a suit under Title VII, always carries the burden of proof
Indicate whether the statement is true or false