Question
On July 1, MTC Wholesalers had a cash balance of $125,000 and accounts payable of $160,000, and Inventory of $78,000. Actual sales for May and
On July 1, MTC Wholesalers had a cash balance of $125,000 and accounts payable of $160,000, and Inventory of $78,000. Actual sales for May and June, and budgeted sales for July, August, September, and October are
All sales are on credit with 60% collected during the month of sale, 30% collected during the next month, and 10% collected during the second month following the month of sale. Cost of goods sold averages 60% of sales revenue. Ending inventory is one-half of the next months predicted cost of sales. The other half of the merchandise is acquired during the month of sale. All purchases are paid for in the month after purchase. Operating costs are estimated at $95,000 each month and are paid during the month incurred.
Required: Prepare purchases and cash budgets for July, August, and September.
Month May. June Actual Sales $250,000 225,000 Month July... August September October Budgeted Sales $260,000 240,000 270,000 275,000Step by Step Solution
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Auditing Cases An Interactive Learning Approach
Authors: Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt
5th edition
132567237, 978-0132998345, 132998343, 978-0132567237
