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Why is the answer a), I tried to do cash disbursement august = budgeted purchases but it didn't work. 33. (Appendix 10A) Conner Company is
Why is the answer a), I tried to do cash disbursement august = budgeted purchases but it didn't work.
33. (Appendix 10A) Conner Company is a medium-sized toy distributor. Experience has shown that 30% of sales are collected within the month of sale, 00% is collected the month after the sale, and 10% is collected two months after the sale. Inventory on hand at the end of a month is to be 70% of the next month's budgeted sales. Cost of goods sold is 50% of the selling price. Payment for purchases is made in the month after purchase. All other costs are paid in the month incurred. Budgeted amounts are as follows: March ll\" M_a'g June M August Sales $10,000 $20,000 $30,000 $30,000 $50,000 $40,000 Costs: Wages 1,500 2,000 2,500 1,500 Rent 500 500 500 500 Other 400 500 600 500 Total cash disbursements in August are expected to be: a) $24,000 b) $45,500 c) $21,500 0) $31,000Step by Step Solution
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