Kelly Company is a retail sporting goods store. Facts regarding Kelly's operations are as follows:

Sales are budgeted at $$220,000$ for November and $$200,000$ for December.

Collections are expected to be $60\%$ in the month of sale and $38\%$ in the month following the sale. $2\%$ of sales are expected to be uncollectible.

The cost of goods sold is $75\%$ of sales.

A total of $80\%$ of the merchandise is purchased in the month prior to the month of sale and $20\%$ is purchased 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 $$22,600.$

Monthly depreciation is $$18,000.$

Kelly Company

Statement of Financial Position

October $31$

Assets

Cash

$$22,000$

Accounts receivable

$($net of allowance for uncollectible accounts$)$

Inventory

$76,000$

Property, plant and equipment

$($net of $$680,000$ accumulated depreciation$)$

Total assets

Liabilities and Stockholders' Equity

Accounts payable

$$162,000$

Common stock

Retained earnings

Total liabilities and stockholders' equity

$800,000$

$\frac{138,000}{\text{\$}1,100,000}$

$82.$ The projected balance in accounts payable on November $30$ is:

A$)$ $$162,000$

B$)$ $$204,000$

C$)$ $$153,000$

D$)$ $$160,000$

Answer: C Level: Medium LO: $10$ Source: CMA, adapted

$83.$ The projected balance in inventory on November $30$ is:

A$)$ $$160,000$

B$)$ $$120,000$

C$)$ $$153,000$

D$)$ $$150,000$

Answer: B Level: Hard LO: $10$ Source: CMA, adapted