4.Assume that a company expects to produce 11,400, 12,400, and 14,400 units of finished goods in January, February, and March, respectively. Each unit of finished goods requires 3 pounds of raw material and each pound of raw material costs $4.50. The company always maintains an ending raw materials inventory equal to 20% of next months production needs. What is the amount of expected raw materials purchases for February?

Multiple Choice

• $172,800

• $134,400

• $169,200

• $122,520

1.Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $48,000 and $72,000, respectively. The company expects to collect 60% of its credit sales in the month of the sale, 35% in the following month, and 5% is deemed uncollectible. What amount of cash collections from credit sales would the company include in its cash budget for the second month?

Multiple Choice

• $60,000

• $63,600

• $25,200

• $43,200

2.Assume the following budgeted information for a merchandising company: Budgeted sales (all on credit) for November, December, and January are $243,000, $213,000, and $204,000, respectively. Cash collections related to credit sales are expected to be 75% in the month of sale, 25% in the month following the sale. The cost of goods sold is 70% of sales. Each months ending inventory equals 15% of next months cost of goods sold. 30% of each months merchandise purchases are paid in the current month and the remainder is paid in the following month. Monthly selling and administrative expenses that are paid in cash in the month incurred total $22,500. Monthly depreciation expense is $6,500. The budgeted net operating income for December would be:

Multiple Choice

• $41,400

• $15,344

• $21,844

• $34,900