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The following information pertains to Tiffany Company: Cash is collected from customers in the following manner: Month of sale 2 5 % Month following the

The following information pertains to Tiffany Company:
Cash is collected from customers in the following manner:
Month of sale 25%
Month following the sale 70%
-Two months after the sale 5%
20% of purchases are paid for in cash in the month of purchase, and the balance is
paid the following month.
Labour costs are 30% of sales. Other operating costs are $15,000 per month
(including $4,000 of depreciation). Both of these are paid in the month incurred. The
cash balance on March 1 is $4,000. A minimum cash balance of $3,000 is required at
the end of the month. Money can be borrowed in multiples of $1,000.
a. How much cash will be collected from customers in March?
b. How much cash will be paid to suppliers in March?
c. How much cash will be disbursed in total in March?
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