Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hassan Choohamaar Supply sells rodent eradication supplies. Data regarding the store's operations follow: Sales are expected to be Rs.220,000 for November, Rs.230,000 for December, and

Hassan Choohamaar Supply sells rodent eradication supplies. Data regarding the store's operations follow: Sales are expected to be Rs.220,000 for November, Rs.230,000 for December, and Rs.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 75% 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 Rs.22,500. Monthly depreciation is Rs.19,000. Ignore taxes. Following balances are extracted from Statement of Financial Position on October 31 Cash Rs.16,000 Accounts receivable (net of allowance for doubtful debts) Rs.76,000 Property, plant & equipment (net of Rs.536,000 accumulated depreciation) Rs.956,000 Required: (2 Marks each; round to whole number) a) In December, How much cash would be paid to suppliers for purchases? b) In November, what would be total cash receipts? c) What would be net income for November? d) What would be accounts receivable balance at end of December? e) What would be accounts payable balance at end of November

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Modern Management Concepts And Skills

Authors: Samuel Certo, S Certo

15th global Edition

978-1292265193, 1292265191

More Books

Students also viewed these Accounting questions