4. Traders, Inc. uses accrual accounting. Its balance sheet as of the end of the third quarter of the calendar year 2020 is shown below:

TRADER'S, INC.
Statement of Financial Position
September 30, 2020
		Assets				Liabilities and Equity
Cash		416,000		Accounts Payable			1,400,000
Accounts Receivable. Net		1,200,000
Merchandise Inventory		2,520,000		Capital Stock			7,200,000
Non-current assets		8,000,000		Retained Earnings			3,536,000
Total Assets		12,136,000		Total Liabilities and Owner's Equity			12,136,000

• Budgeted sales for October is P4,160,000; for November P4,000,000
• Gross Profit is 20%
• Of the total sales, 40% is on credit which the company collects in the month following the month of sale
• Purchases in each month are composed of:

80% of the coming months cost of goods sold

20% of the current months cost of goods sold

• Purchases are paid in the month they were purchased.

Compute for the following:

1. Budgeted cash collections for the month of October
2. Budgeted purchases payments during October
3. Budgeted gross profit for the month of October