Carpon Lumber sells lumber and general building supplies to building contractors in a medium-sized town in Montana. Data regarding the store's operations follow: Production is budgeted at 341,000 for November, $352,000 for December, and $371,000 for January. The company has a policy of keeping 10 percent of next months sales needs in inventory. Collections are expected to be 55% in the month of sale, 44% in the month following the sale, and 1% uncollectible. The cost of goods sold is 75% of sales. The company desires to have an ending merchandise inventory equal to 60% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are $21,100. Monthly depreciation is $19,000. Ignore taxes.

The difference between cash receipts and cash disbursements in December would be: A. $61,500 B. $62,050 C. $60,300 D. $65,400

Statement of Financial Position October 31 Assets Cash Accounts receivable (net of allowance for uncollectible accounts)............... Inventory. Property, plant and equipment (net of $598,000 accumulated depreciation..1138,000 Total assets $13,000 82,000 153,000 386,000 Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity 257,000 600,000 529.000 S1,386,000 $ 257,000