The following information pertains to the January operating budget for Casey Cor

B. $67,000 Budgeted cash payments for purchases are $67,000 as accounts payable.

ID: 2570355 • Letter: T

Question

The following information pertains to the January operating budget for Casey Corporation.

Budgeted sales for January $210,000and February $108,000.

Collections for sales are40%in the month of sale and 60% the next month.

Gross margin is 35% of sales.

Administrative costs are$11,000each month.

Beginning accounts receivable is $22,000.

Beginning inventory is $23,000.

Beginning accounts payable is$67,000.(All from inventory purchases.)

Purchases are paid in full the following month.

Desired ending inventory is 25% of next month's cost of goods sold (COGS).

For January, budgeted cash payments for purchases are ________.

A.$62,500

B.$67,000

C.70,200

D.$ 108000

B. $67,000

Budgeted cash payments for purchases are $67,000 as accounts payable.

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