Question
the following information pertains to Hepburn Company: Month Sales Purchases January $70,000 $38,000 February $85,000 $41,000 March $101,000 $61,000 Cash is collected from customers in
the following information pertains to Hepburn Company:
Month | Sales | Purchases |
January | $70,000 | $38,000 |
February | $85,000 | $41,000 |
March | $101,000 | $61,000 |
Cash is collected from customers in the following manner:
Month of sale 35%
Month following the sale 65%
50% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month.
Labor costs are 25% of sales. Other operating costs are $38,000 per month (including $9,000 of depreciation). Both of these are paid in the month incurred,
The cash balance on March 1 is $10,000. A minimum cash balance of $6,000 is required at the end of the month. Money can be borrowed in multiples of $1,000.
How much cash will be collected from customers in March?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started