Question
1.The following data have been taken from the budget reports of Brandon company, a merchandising company. Purchases Sales Jan $160,000 $100,000 Feb $160,000 $200,000 Mar
1.The following data have been taken from the budget reports of Brandon company, a merchandising company.
Purchases Sales
Jan $160,000 $100,000
Feb $160,000 $200,000
Mar $160,000 $240,000
Apr $140,000 $300,000
May $140,000 $260,000
Jun $120,000 $240,000
Forty percent of purchases are paid for in cash at the time of purchase, and 30% are paid for in each of the next two months.
Purchases for the previous November and December were $150,000 per month. Employee wages are 10% of sales for the month in which the sales occur.
Selling and administrative expenses are 20% of the following month's sales. (July sales are budgeted to be $220,000.)
Interest payments of $20,000 are paid quarterly in January and April.
What is the expected net cash flow from operations (receipts minus disbursements) for the month of March?
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