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Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: - Sales are budgeted at $290,000
Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: - Sales are budgeted at $290,000 for November, $310,000 for December, and $210,000 for January. - Collections are expected to be 65% in the month of sale, 33% in the month following the sale, and 2% uncollectible. -The cost of goods sold is 80% of sales. - The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. 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 $21,000. - Ignore taxes. Statement of Financial Position October 31 Assets: Cash Accounts receivable (net of allowance for uncollectible accounts). Inventory. Property, plant and equipment (net of $624,000 accumulated depreciation). Total assets. Liabilities and Stockholders' Equity: Accounts payable. Common stock Retained earnings. Total liabilities and stockholders' equity... Reference: 9-2 $ 25,000 77,000 162,400 1,026,000 $1.290.400 $ 239,000 740,000 311,400 $1.290.400 December cash disbursements for merchandise purchases would be: O $192,000 $243,200 O $117,600
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