Question
WinBikes Pty Ltd is selling and provides services for bicycles. As at December 2021, it has the bank balance of $25,000. Below are estimates for
WinBikes Pty Ltd is selling and provides services for bicycles. As at December 2021, it has the bank balance of $25,000. Below are estimates for the three months ending 31 March 2022
Items | January ($) | February ($) | March ($) |
Sales | 750,000 | 550,000 | 450,000 |
Bike Servicing | 50,000 | 100,000 | 20,000 |
Salaries and Wages | 250,000 | 200,000 | 200,000 |
Administration | 50,000 | 50,000 | 50,000 |
Purchases - Bikes | 500,000 | 400,000 | 300,000 |
Purchases - parts | 10,000 | 14,000 | 3,000 |
Depreciation | $2,000 | $2,000 | $2,000 |
Interest income | $500 |
Additional information:
- Sales are 75% cash and 25% credit. Credit customers are paying 60% in the month of sale, and 40% in the month following the sales. December's sale was $800,000.
- Bike servicing are cash only to retail customers
- Purchases - Bikes: are on credit, pay the month following the purchase. Purchase for December 2021 was $450,000
- Purchase - parts: are paid by cash
- Depreciation is according to a straight-line method
- Due to COVID, the business has grown significantly. They have to extend the store and spend $200,000 to renovate the vacant store next door. The renovation will start in January 2022.
a) Calculate the total cash payments for February only, using the table provided below:
Names of cash payment items | February ($) |
Total Cash Payments | ? |
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