Dilly Farm Supply is located in a small town in the rural west Data regarding the store's operations follow Sales are budgeted at $302,000 for November, $322,000 for December, and $222,000 for January Collections are expected to be 65 in the month of sale and 35 in the month following the sale The cost of goods sold is 80 of sales The company desires to have an ending merchandise inventory at the end of each month equal to 70 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 $22,300 Monthly depreciation is $27,000 Ignore taxes Balance Sheet October 31 Assets Cash $ 32,500 Accounts receivable 83,000 Merchandise inventory 287,900 Property, plant and equipment, net of $624,000 accumulated depreciation 917,000 Total assets $ 1,320,400 Liabilities and Stockholders' Equity Accounts payable $ 251,000 Common stock 752,000 Retained earnings 317,400 Total liabilities and stockholders' equity $ 1,320,400 Expected cash collections in December are Dilly Farm Supply is located in a small town in the rural west Data regarding the store's operations follow Sales are budgeted at $302,000 for November, $322,000 for December, and $222,000 for January Collections are expected to be 65 in the month of sale and 35 in the month following the sale The cost of goods sold is 80 of sales purchase Other monthly expenses to be paid in cash are $22,300 Monthly depreciation is $27,000 Ignore taxes Expected cash collections in December are Multiple Choice $315,000 $322,000 $209,300 $105,700

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 17, 2024

Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: Sales are budgeted at $302,000 for

Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:

Sales are budgeted at $302,000 for November, $322,000 for December, and $222,000 for January.

Collections are expected to be 65% in the month of sale and 35% in the month following the sale.

The cost of goods sold is 80% of sales.

The company desires to have an ending merchandise inventory at the end of each month equal to 70% 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 $22,300.

Monthly depreciation is $27,000.

Ignore taxes.

Balance Sheet
October 31
Assets
Cash	$ 32,500
Accounts receivable	83,000
Merchandise inventory	287,900
Property, plant and equipment, net of $624,000 accumulated depreciation	917,000
Total assets	$ 1,320,400
Liabilities and Stockholders' Equity
Accounts payable	$ 251,000
Common stock	752,000
Retained earnings	317,400
Total liabilities and stockholders' equity	$ 1,320,400

Expected cash collections in December are:

image text in transcribed

Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: - Sales are budgeted at $302,000 for November, $322,000 for December, and $222,000 for January. - Collections are expected to be 65% in the month of sale and 35% in the month following the sale. - The cost of goods sold is 80% of sales. purchase. - Other monthly expenses to be paid in cash are $22,300. - Monthly depreciation is $27,000. - Ignore taxes. Expected cash collections in December are: Multiple Choice $315,000 $322,000 $209,300 $105,700