Question
Metlock state sells electronic products. The controller is responsible for preparing the master budget and has accumulated the information below for the months of january,
Metlock state sells electronic products. The controller is responsible for preparing the master budget and has accumulated the information below for the months of january, february, and march.
Balances at january 1 are expected to be as follows:
Cash $5720
Inventories $321,800
Accounts receivable 432,700
Accounts payable 138,400
The budget is to be based on the following assumptions.
- Each month's sales are billed on the last day of the month
- Customers are allowed a 3% discount if their payment is made within 10 days after the billing date. Receivables are booked at gross.
- The company collects 60% of the billings within the discount period, 25% by the end of the month after the date of sale, and 9% by the end of the second month after the date of sale; 6% prove uncollectible
- It pays 54% of all materials purchases and the selling, general, and administrative expenses in the month purchased and the remainder in the following month. Each month's units of ending inventory are equal to 130% of the next month;s units of sales.
- The cost of each unit of inventory is $20
- Selling , general, and administrative expenses, of which $2,100 is for depreciation, are equal to 15% of the current month's sales.
- Actual and projected sales are as follows:
November sales is $369,000 and the units is 12,300
December sales is $378,000 and the units is 12,600
January sales is $372,000 and the units is 12,400
February sales is $357,000 and the units is 11,900
March sales is $375,000 and units is 12,500
April sales is $381,000 and units is 12,700
Calculate th budgeted cash disbursements during the month of february
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