Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Tung Corporation has prepared the following sales budget: Month Sales in units January 7,000 February 8,000 March 7,400 April 7,200 Tung purchases only the units
Tung Corporation has prepared the following sales budget:
Month | Sales in units |
January | 7,000 |
February | 8,000 |
March | 7,400 |
April | 7,200 |
Tung purchases only the units projected for sales each month.
The average purchase cost of each unit is $70 and 10% of purchases are paid in full in the month of purchase. Tung gets a 2% prompt payment discount on these purchases. The remaining 90% of purchases are paid for in full in the following month.
Total selling, general, and administrative costs amount to $24,000 each month, of which $3,650 is depreciation.
How much cash is disbursed in total in February?
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