=+TabComp’s month-end inventory requirements for computer hardware units are 30% of the next month’s sales. A one-month lead time is required for delivery from the manufacturer. Thus orders for computer hardware units are placed on the 25th of each month to ensure that they will be in the store by the first day of the month needed. The computer hardware units are purchased under terms of n/45 (payment in full within 45 days of invoice), measured from the time the units are delivered to TabComp. TabComp’s purchase price for the computer units is 60% of the selling price.

Chapter 10: Master budget and responsibility accounting 405 M10_HORN3377_02_LT_C10.indd 405 2/09/13 3:46 PM TabComp Ltd Sales forecast for first six months of 2014 Hardware sales Software sales Units Dollars and support Total revenues January 130 $390 000 $160 000 $550 000 February 120 360 000 140 000 500 000 March 110 330 000 150 000 480 000 April 90 270 000 130 000 400 000 May 100 300 000 125 000 425 000 June 125 375 000 225 000 600 000 Total 675 $2 025 000 $930 000 $2 955 000 Required 1 Calculate the cash that TabComp can expect to collect during April 2014. Make sure you show all of your calculations.