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The following data relate to the operations of Picanuy Corporation, a wholesale distributor of consumer goods: Current assets as of December 31: Cash $ 5,300
| The following data relate to the operations of Picanuy Corporation, a wholesale distributor of consumer goods: |
| Current assets as of December 31: | ||
| Cash | $ | 5,300 |
| Accounts receivable | $ | 38,340 |
| Inventory | $ | 10,920 |
| Buildings and equipment, net | $ | 113,600 |
| Accounts payable | $ | 32,320 |
| Capital stock | $ | 100,000 |
| Retained earnings | $ | 35,840 |
| | ||
| a. | The gross margin is 30% of sales. (In other words, cost of goods sold is 70% of sales.) |
| b. | Actual and budgeted sales data are as follows: |
| December (actual) | $ 63,900 |
| January | $ 78,000 |
| February | $ 88,000 |
| March | $ 91,500 |
| April | $ 63,700 |
| | |
| c. | Sales are 40% for cash and 60% on credit. Credit sales are collected in the month following sale. The accounts receivable at December 31 are the result of December credit sales. |
| d. | Each month |
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