Which of the following statements is false with respect to the manufacturing overhead budget?

Multiple Choice

• It includes estimated variable overhead and estimated fixed overhead.

• It flows through to cost of goods sold on the income statement for merchandising companies.

• It estimates the cash disbursements for overhead that appear in the cash budget.

• It includes depreciation even though it is not a cash flow.

Assume a merchandising company provides the following information from its master budget for the month of May:

Sales	$ 120,000
Cost of goods sold	$ 80,000
Selling and administrative expenses	$ 35,000
Accounts receivable, May 1st	$ 15,000
Accounts receivable, May 31st	$ 20,000

If all of the companys sales are on account, what is the amount of cash collections from customers included in the cash budget for May?

Multiple Choice

• $105,000

• $110,000

• $120,000

• $115,000