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Question #1

In your own words, list and describe five differences between financial accounting and managerial accounting. Be sure to explain how the two differ on each point you list.

Question #2

Describe in your own words the two major components of budgets that we discussed in the budgeting process Chat Session. As part of your description, you should provide specific examples of each.

Question #3

List and describe four potential advantages of budgeting and four potential disadvantages of budgeting. As part of your description, you should provide specific examples of the advantages and disadvantages.

Question #4

See Power point Problem given along with the above questions.

XYZ Company is a retailer of upscale widget products. The sales forecast for the coming months is:

Revenues

April $ 250,000

May $ 275,000

June $ 300,000

July $ 350,000

August $ 375,000

XYZ Company's sales are 60%cash and 40% store credit. The credit sales are 70% in the month of sale, and the remainder is collected in the following month. Accounts receivable on April 1 are $50,000

XYZ Company's cost of sales are averages60% of revenues. The inventory policy is to carry 25% of next month's sales needs. April 1 inventory will be as expected under the policy. XYZ Company pays for purchases

56% in the month of purchase and the remaining amount in the following month. Accounts Payable on April 1 are$90,000

a. Prepare a purchases budget for as many months as is possible.

b. Prepare a cash payments budget for April through June.

c. Prepare a cash receipts budget for April through June.