Sales and Purchase Budgets

Question 3
1. The sales budget has been shown below:
Pinner Hardware
Sales Budget for Qtr Oct-Dec'19
Particulars Oct Nov Dec Quarter
Budgeted unit sales 46,000 55,000 56,000 157,000
Selling price per unit 30 30 30 30
Budgeted total sales
revenue
1,380,00
0
1,650,00
0
1,680,00
0
4,710,00
0
Budgeted cash sales 414,000 495,000 504,000 1,413,000
Budgeted credit sales 966,000 1,155,000 1,176,000 3,297,000
Budgeted total sales
revenue
1,380,00
0
1,650,00
0
1,680,00
0
4,710,00
0
Expected sales
collections
From cash sales 414,000 495,000 504,000 1,413,000
From August credit
sales 483,840 483,840
From September credit
sales 420,000 403,200 823,200
From October credit
sales 483,000 463,680 946,680
From November credit
sales 577,500 577,500
Total Cash
collections
1,317,84
0
1,381,20
0
1,545,18
0
4,244,22
0
2. The purchase budget has been shown below:
Pinner Hardware
Purchase Budget for Qtr Oct-Dec'19
Particulars Oct Nov Dec Quarter
Budgeted total unit sales 46,000 55,000 56,000 157,000
Add: Desired Ending
inventory 13,750 14,000 10,000 10,000
Total supplies required 59,750 69,000 66,000 167,000
Less: Beginning inventory 11,500 13,750 14,000 11,500

Budgeted purchases for the
month 48,250 55,250 52,000 155,500
Purchase price per unit 12 12 12 12
Cost of purchases 579,000 663,000 624,000 1,866,000
Cash Payment for
purchases 498,000 579,000 663,000 1,740,000
Question 4
1. The journal entries and the ledger accounts have been shown below:
Paula's hairdressing
General Journal
Account Titles and Explanations Acct. No. Debit Credit
Cash at Bank A/C 101 20,000
To Capital A/C 301 20,000
(Being capital introduced)
Prepaid Rent A/C 110 9,000
GST 111 900
To Cash at Bank A/C 101 9,900
(Being rent paid in advance)
Shop Equipment 120 2,500
GST 111 250
To Cash at Bank A/C 101 2,750
(Being equipment purchased)
Supplies 105 480
GST 111 48
To Accounts Payable 201 528
(Being supplies procured on credit)
Accounts Receivables 106 770
To Service Revenue 401 700
To GST 111 70
(Being services rendered)