The management of Rapid Hardware financial position statement

This is an assignment that discusses the management of Rapid Hardware financial position statement. The paper also offers a brief of its statement as of 31st March.,The management of Rapid Hardware financial position statement,INSTRUCTION:  Answer all questions,The management of Rapid Hardware has asked you to prepare a master budget for the months of April, May and June 2018 for the entity using the following information.,Statement of Financial Position as at 31 March 2018,ASSETS                                              Cost ($)           Depreeciation ($)        Net book value ($), Equipment                              480,000           90,000                         390,000, Current assets, Inventory                                                        126,000, Accounts Reveivable                                      175,000, Cash                                                                  50,000                       351,000, 741,000,LIABILITIES $ SHAREHOLDERS’ EQUITY, Equity, Ordinary shares                                              235,000, Retained Earnings                                          138,000                       373,000, Non-current Liabilities, Long-term note payable                                 200,000, Current liabilities, Accounts payable                                           156,000, short-term notes payable                                  12,000                       368,000, 741,000, The management of Rapid Hardware financial position statement,The following details were also available:,a.                Firstly, actual units of sales for March were 10,000 units and each month’s sales are expected to exceed the prior month’s results by 5%. The selling price for each unit is $25.00, b.               Secondly, the policy of Rapid Hardware for ending inventory of a given month is to be equal to 80% of the next month’s expected sales. Subsequently, the March 31 inventory was 8,400 units based on this policy., c.                Thirdly, sales representatives’ commissions are 12.5/5 and they are payable in the month of the sales. The manager’s salaries will be $3,500 in April and $4,000 for each month thereafter., d.               Fourthly, the general and administrative expenses include administrative salaries of $8,000 per month, depreciation of $5,000 per month and also 0.9% monthly interest on the long term note payable.,f.                Also, all purchases are on credit and no payable arise from any other transactions. Purchases are payable in the next month. Also, the purchase price is $15 per unit., g.               Consequently, the minimum ending cash balance for all the months is $50,000 and if necessary, the company will borrow enough cash to reach this target. Additionally, the short-term notes will require an interest payment of 1% at the end of each month. If the ending cash balance exceeds the minimum, also the excess will be applied to repaying the short-term notes payable., h.               Then, dividends of $100,000 are to be declared and paid in May., i.                 Lastly, no cash payments for income taxes are to be made during the second quarter.,Master budget,Additionally, you are to prepare the following budgets and other financial information in order to assist you to complete the ,master budget,:,1.                 Sales budget, including that for July, 2.                 The purchases budget to include the budgeted cost of goods sold for each month and the quarter and also the cost of the June 30 budgeted inventory, 3.                 The selling expense budget, 4.                 The general and administrative expense budget, 5.                 The budget for expected cash receipts from customers and also the expected June 30 accounts receivable balance, 6.                 The budget for expected cash payments for purchases and also the expected June 30 balance for accounts payable, 7.                 The cash budget for the quarter, 8.                 Lastly, the budgeted retained earnings statement,Attachments,Click Here To Download,

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New York University

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