Question
Depotissimo , has predicted the following sales for the first four months of 2015 January $ 6,000 March $ 15,000 February $ 11,000 April
Depotissimo " , has predicted the following sales for the first four months of 2015
January | $ 6,000 | March | $ 15,000 |
February | $ 11,000 | April | $ 17,000 |
Monthly purchases of raw materials accounts for 60 % of sales forecast for the next month.
Of total raw material purchases , payments are 60% in cash in the same month and 40% on credit. Of credit purchases 70% is paid in the following month and 30% is paid in two months.
Predicted costs for the company during this period are: Labor $ 1,000 per month , fixed overhead costs of $600 per month.
Two Interest payments on the debt of $650 each will be made in January and February.
Finally , at the end of the month of March sales staff receive a commission of 3 % of total sales for the first three months of the year and to be paid on March 30.
Calculate the final cash outflows in the month of February ?
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