Question
67. A company has projected the following sales for the spring quarter of 2014: April $200,000 May $250,000 June $275,000 65% of all sales are
67. A company has projected the following sales for the spring quarter of 2014:
April
$200,000
May
$250,000
June
$275,000
65% of all sales are paid for with cash. The remainder is on credit.
The pattern for credit receivables collections are:
Month of Sale
60%
Month After Sale
30%
Second Month After Sale
10%
What are the forecasted cash collections for the month of June?
68. A company budgeted the following purchases for raw materials:
Month
January
February
March
April
May
June
July
Budget
$10,000
$20,000
$25,000
$22,000
$27,000
$30,000
$24,000
The company has a policy of paying for 40% of the purchases in the month of purchase, 35% in the month following the purchase, and 25% in the second month following the purchase.
Based on this information, what are the budgeted cash disbursements for May?
69. A company plans to purchase inventory for the second half of 2014 as follows:
July
$100,000
August
$75,000
September
$225,000
October
$125,000
November
$250,000
December
$30,000
They usually pay 50% of inventory purchases in the month of purchase, 35% in the following month, and 15% in the second month. Based on this information, what are the forecasted total 2014 cash payments for inventory purchased in the second half of 2014?
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Cornerstones of Managerial Accounting
Authors: Maryanne Mowen, Don Hanson, Dan Heitger, David McConomy, Bradley Witt, Jeffrey Pittman
3rd Canadian edition
176530886, 176721231, 978-0176721237
