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Problem 7-19A Schedules of Expected Cash Collections and Disbursemen.pdf
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Problem 7-19A Schedules of Expected Cash Collections and Disbursemen.pdf

  1. Problem 7-19A Schedules of Expected Cash Collections and Disbursements [LO7-2, LO7-4, LO7-8] Sales on account are collected over a three-month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible. Purchases of inventory will total $376,000 for December. Thirty percent of a month’s inventory purchases are paid during the month of purchase. The accounts payable remaining from November’s inventory purchases total $174,500, all of which will be paid in December. Prepare a schedule of expected cash disbursements for merchandise purchases for December. Prepare a cash budget for December. Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month. References eBook & ResourcesYou have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company’s operations: Solution 1) Schedule of Cash Receipt for the month: Schedule-1 (2) Shedule of Cash Disbursement 3)OctoberCash Sales68400Credit Sales415000Cash Collection of current Credit Sales83000151400NoveCash Sales87400Credit Sales614000Earlier cash received- October249000Cash Collection of current Credit Sales122800459200DecCash Sales95800Credit Sales692000Earlier cash received-October74700Earlier cash received- November73680Cash Collection of current Credit Sales138400382580
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