Capes Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow:

Sales are budgeted at $370,000 for November, $380,000 for December, and $360,000 for January.

Collections are expected to be 45% in the month of sale and 55% in the month following the sale.

The cost of goods sold is 70% of sales.

The company desires an ending merchandise inventory equal to 25% of the cost of goods sold in the following month. Payment for merchandise is made in the month following the purchase.

The November beginning balance in the accounts receivable account is $72,000.

The November beginning balance in the accounts payable account is $259,000.

Required:

a. Prepare a Schedule of Expected Cash Collections for November and December.

b. Prepare a Merchandise Purchases Budget for November and December.

Required B

Prepare a Merchandise Purchases Budget for November and December.

Merchandise Purchases Budget	November	December
Cost of goods sold
Total needs
Required purchases

Prepare a Schedule of Expected Cash Collections for November and December.

	November	December
Sales
Schedule of Expected Cash Collections
Accounts receivable
November sales
December sales
Total cash collections