1. Middlefield Company's budgeted income statement reflects the following amounts: Sales Purchases Expenses January $ 116,000 $ 74,000 $ 23,600 February 106,000 62,000 23,800 March 121,000 77,250 26,600 April 126,000 80,500 28,200 Sales are collected 50% in the month of sale, 20% in the month following sale, and 29% in the second month following sale. One percent of sales is uncollectible and expensed at the end of the year. Middlefield pays for all purchases in the month following purchase and takes advantage of a 1% discount. The following balances are as of January 1: Cash $ 84,000 Accounts receivable* 54,000 Accounts payable 68,000 *Of this balance, $21,600 will be collected in January and the remaining amount will be collected in February. The monthly expense figures include $4,600 of depreciation. The expenses are paid in the month incurred. Morgans budgeted cash receipts in February are: Multiple Choice $80,200. $108,600. $108,240. $76,200. $107,690.

2.

Terryville Corporation plans to sell 35,000 units of its single product in March. The company has 2,200 units in its March 1 finished-goods inventory and anticipates having 1,800 completed units in inventory on March 31. On the basis of this information, how many units does Terryville plan to produce during March?

Multiple Choice

• 34,600.

• 35,400.

• 37,200.

• 39,000.

• None of the answers is correct.