ABC Company is preparing its Selling and Administrative Expense budget.ABC Company predicts sales as follows:

JanuaryFebruaryMarch$6,200$5,500$7,900

ABC Company has prepared the following list of expected operating expenses:

• $2,600 Salary Expense per month
• Commissions 5% of monthly Sales
• Rent Expense $1,100 per month
• $700 Depreciation per month

January is ABC Company's first month of operations, so there are no beginning account balances.

Commissions are paid the month after they are earned.

Determine the amount of Commissions Payable as of March 31.

$310

Correct Answer

$395

$0

$980

Review Homework Question 8.7 for more practice.

Unanswered

Question 2

0/ 1pts

ABC Company is a brand new company.ABC has budgeted Sales as follows:

JanuaryFebruaryMarchApril$730,000$876,000$963,600$1,059,960

Cost of Goods Sold is expected to be 35% of Sales and ABC would like to maintain an ending inventory balance equal to 20% of the following month's Cost of Goods Sold.

Determine the Cost of Goods Sold reported on the first quarter pro forma Income Statement.

Correct Answer

$899,360

$370,986

$337,260

$1,270,346

Review Homework Question 8.4 - 8.6 for more practice.

Unanswered

Question 3

0/ 1pts

During June, ABC Company had sales of $780,000.Sales are expected to increase 10% each month.35% of total sales are expected to be on account.ABC Company normally collects 100% of accounts receivable in the month following the month of sale.Determine the amount of total budgeted collections for July.

$858,000

$300,300

$557,700

Correct Answer

$830,700

Review Homework Question 8.2 & 8.3 for more practice.

Unanswered

Question 4

0/ 1pts

ABC Company is a brand new company.ABC has budgeted Sales as follows:

JanuaryFebruaryMarchApril$730,000$876,000$963,600$1,059,960

Cost of Goods Sold is expected to be 35% of Sales and ABC would like to maintain an ending inventory balance equal to 20% of the following month's Cost of Goods Sold.

What is the total inventory needed for February?

Correct Answer

$374,052

$67,452

$312,732

$306,600

Review Homework Question 8.4 & 8.6 for more practice.

Unanswered

Question 5

0/ 1pts

Which one of the following reports does not display the ending Cash balance for the budgeted quarter?

Pro Forma Statement of Cash Flows

Correct Answer

Sales Budget

Pro Forma Balance Sheet

Cash Budget

Review Homework Question 8.9 for more practice.

Unanswered

Question 6

0/ 1pts

ABC Company is preparing its Selling and Administrative Expense budget.ABC Company predicts sales as follows:

JanuaryFebruaryMarch$6,200$5,500$7,900

ABC Company has prepared the following list of expected operating expenses:

• $2,600 Salary Expense per month
• Commissions 5% of monthly Sales
• Rent Expense $1,100 per month
• $700 Depreciation per month

January is ABC Company's first month of operations, so there are no beginning account balances.

Commissions are paid the month after they are earned.

What is ABC Company's budgeted total payment for selling and administrative expenses for the month of January?

$4,710

$4,010

$4,400

Correct Answer

$3,700

Review Homework Question 8.7 for more practice.

Unanswered

Question 7

0/ 1pts

ABC Company is preparing an Inventory Purchases Budget.Purchases for the current month and expected purchases for the next three months are listed below:

MarchAprilMayJune$340$390$420$270

All purchases are made on account.ABC's suppliers require that 70% of purchases on account be paid in the month of purchase.The remaining 30% are paid in the following month.

What is April's total budgeted disbursements for inventory?

$355

$340

$390

Correct Answer

$375

Review Homework Question 8.5 & 8.6 for more practice.

Unanswered

Question 8

0/ 1pts

During June, ABC Company had sales of $780,000.Sales are expected to increase 10% each month.35% of total sales are expected to be on account.Determine the projected total sales for July.

Correct Answer

$858,000

$938,000

$78,000

$943,800

Review Homework Question 8.1 & 8.3 for more practice.

Unanswered

Question 9

0/ 1pts

ABC Company is preparing its Selling and Administrative Expense budget.ABC Company predicts sales as follows:

JanuaryFebruaryMarch$6,200$5,500$7,900

ABC Company has prepared the following list of expected operating expenses:

• $2,600 Salary Expense per month
• Commissions 5% of monthly Sales
• Rent Expense $1,100 per month
• $700 Depreciation per month

January is ABC Company's first month of operations, so there are no beginning account balances.

Commissions are paid the month after they are earned.

What is ABC Company's budgeted total selling and administrative expense for the month of January?

Correct Answer

$4,710

$4,400

$4,010

$1,490

Review Homework Question 8.7 for more practice.

Unanswered

Question 10

0/ 1pts

During June, ABC Company had sales of $780,000.Sales are expected to increase 10% each month.35% of total sales are expected to be on account.ABC Company normally collects 100% of accounts receivable in the month following the month of sale.Determine the amount of sales revenue ABC Company will report on the pro forma Income Statement for the quarter July - September.

$363,363

Correct Answer

$2,839,980

$1,845,987

$1,038,180

Review Homework Question 8.1 - 8.3 for more practice.