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A company is formulating Its marketing expense budget for the last quarter of the year. Sales In units for the third quarter amounted to 3,600,
A company is formulating Its marketing expense budget for the last quarter of the year. Sales In units for the third quarter amounted to 3,600, sales volume for the fourth quarter is expected to increase by 10%. Variable marketing expense per unit sold amount to approximately $0.20, pald In cash In month of sale. Fixed marketing expense per month amount to $9,000 of salarles, $4,000 of depreciation (delivery trucks), and $1,800 of Insurance (pald monthly). a. What is the total budgeted marketing expense for the fourth quarter of the year? b. What is the estimated cash payment for marketing expense for the fourth quarter? Total budgeted marketing expense Estimated cash payment b. As the management accountant for the Tyson Company you have been asked to construct a financial planning model for collection of accounts receivable and then to perform a what-if analysis in terms of the assumption regarding estimated uncollectible accounts. You are provided with the following Information: Collection Pattern for Credit Sales: 65% of the company's credit sales are collected in the month of sale, 30% In the month following the month of sale, and 5% are uncollectible. Credit Sales: January 2019, $100,000; February 2019, $120,000; March 2019, $110,000. Required: 1. Prepare an estimate of bad debts for each of the three months, January through March, under the following assumptions regarding the rate of uncollectible accounts: 1%, 3%, 5% (base case), and 8%. Assumed Rate of BID Expense: Estimated Bad Debts Expense January February March 596
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