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Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: Sales are budgeted at $220,000 for

Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: Sales are budgeted at $220,000 for November, $200,000 for December, and $210,000 for January. Collections are expected to be 70% in the month of sale, 27% in the month following the sale, and 3% uncollectible. The cost of goods sold is 65% of sales. The company desires to have an ending merchandise inventory at the end of each month equal to 50% 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 $22,500. Monthly depreciation is $19,000. Ignore taxes.

40. Expected cash collections in December are: A. $59,400 B. $140,000 C. $199,400 D. $200,000

41. The cost of December merchandise purchases would be: A. $133,250 B. $68,250 C. $130,000 D. $143,000

42. December cash disbursements for merchandise purchases would be: A. $136,500 B. $68,250 C. $133,250 D. $130,000

43. The difference between cash receipts and cash disbursements for December would be: A. $17,900 B. $22,500 C. $40,400 D. $62,900

44. The net income for December would be: A. $40,400 B. $22,500 C. $47,500 D. $28,500

45. The cash balance at the end of December would be: A. $116,900 B. $16,000 C. $100,900 D. $56,400

46. The accounts receivable balance, net of uncollectible accounts, at the end of December would be: A. $82,000 B. $113,400 C. $60,000 D. $54,000

47. Accounts payable at the end of December would be: A. $65,000 B. $68,250 C. $130,000 D. $133,250

48. Retained earnings at the end of December would be: A. $132,500 B. $155,000 C. $196,500 D. $183,900

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