Question
Martin Clothing Company is a retail company that sells hiking and other outdoor gear specially made for the desert heat. It sells to individuals
Martin Clothing Company is a retail company that sells hiking and other outdoor gear specially made for the desert heat. It sells to individuals as well as local companies that coordinate adventure getaways in the desert for tourists. The following information is available for several months of the current year. Cash Expenses Paid Month May June July August Sales $ 97,000 122,000 135,000 134,000 Purchases $ 65,000 89,000 117,000 71,000 $ 20,000 29,500 36,750 32,200 The majority of Martin's sales (65 percent) are cash, but a few of the excursion companies purchase on credit. Of the credit sales, 30 percent are collected in the month of sale and 70 percent are collected in the following month. All of Martin's purchases are on account with 60 percent paid in the month of purchase and 40 percent paid the following month.
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