Question
Big Watches Co. makes one product and it provided the following information to help prepare the master budget for its first four months of operations:
Big Watches Co. makes one product and it provided the following information to help prepare the master budget for its first four months of operations:
The budgeted selling price per unit is $84. Budgeted unit sales for September, October, November, and December are 17,000, 19,000, 15,000, and 18,000 units, respectively. All sales are on credit.
35% of credit sales are collected in the month of the sale and 65% in the following month.
The ending finished goods inventory equals 19% of the following months unit sales.
The ending raw materials inventory equals 23% of the following months raw materials production needs. Each unit of finished goods requires 13 pounds of raw materials. The raw materials cost $12.00 per pound.
25% of raw materials purchases are paid for in the month of purchase and 75% in the following month.
What is the accounts receivable balance at the start of December?
Round your answer to the nearest whole number.
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