BUS 180 Projected Balance Sheet
I'm working on a finance project and need guidance to help me learn.
I working on W06 project for my BUS 180 class. In the instructions is says the cash amount for January should be $1489.74 and the amount for December should be $424.74. I want to know how they came up with that answer? Here is a run down of the assignment details.
- With the assumptions and P&L provided on the spreadsheet, use the following information to create a projected Balance Sheet from January through December of year two for Kalei Ukuleles. Refer to the W06 Creative Cakes Practice Projected Balance Sheet assignment for specific instructions.
- Important Information:
- Accounts Receivable: Project that the business will have 5 days of receivables.
- Inventory: Beginning in year two, John's vendor in China will require that he purchase inventory in advance. For this reason, we will account for the Ukulele Inventory on the Balance Sheet using the following assumption: Indicate that John plans on purchasing 33 days inventory a month in advance. This means that the January inventory will be calculated using February COGS and the formula will look like this: =DaysInv/30*D27.
- In April, Days Inventory will be changed to 35 days. (Remember, we did this in the Creative Cakes practice exercise.)
- Equipment: John will purchase $500 of equipment with cash.
- Less: Accumulated Depreciation: Use the same formula as in the Creative Cakes practice exercise.
- Days Payable: Project that the business will have 15 Days Payable.
- Notes Payable: John won’t have any loans until he borrows $3000 cash in March.
- Paid-in-Capital: The January Balance is $5000 and will not change.
- Owner’s Draw: John will not be withdrawing any money from the business.
- Retained Earnings: You know this formula!
- Difference: Enter the Difference amount in the Cash cell for each month. Check to see that the Difference is zero and Total Assets = Liabilities and Owner’s Equity.
- Check your work: The Cash amount for January should be $1489.74 and the amount for December should be $424.74.
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