Bill purchased $80000 good in Sept. and expects to purchase $60,000 of goods in

Question

Bill purchased $80000 good in Sept. and expects to purchase $60,000 of goods in October. He typically pays for 25% of purhcases in the month of purchases and 75% in the next month:

Each month he needs to make these payments: Rent:6000 Utilities:4000 Wages: 9600 Loans:1600 Telephone:1100

Halfway through October, he expects to buy a new computer for 7000 dollars using his companys visa. The visa is paid fully in these months: Sept visa purchases had a total of 8000 dollars.

a) find bills expected cash disbursement for purchases of goods in October

b) what are the total cash disbursements expected by bill during October

c) Marks company makes sales on account. Marks accounts receivable payment experiences are:

percent paid in month of sales: 20%

percent paid in month after sales:75%

percent paid in second month after sale 5%

Mark gave this info on sales: september 60000 october 70000 november 60000 december(expected)58500

What will be his expected cash receipts for november?

Explanation / Answer

Answer a Bills expected cash disbursement for purchases of goods in October October September Purchases ($80000*75%) $60,000 October Purchases ($60000*25%) $15,000 Expected Cash Disbursement for Purchase of Goods in October $75,000 Answer b The total cash disbursements expected by bill during October October Goods Purchases $75,000 Rent $6,000 Utilities $4,000 Wages $9,600 Loans $1,600 Telephone $1,100 Visa $15,000 Total cash disbursements expected by bill during October $112,300 Answer c Expected cash receipts for november November September Sales Collection ($60000*5%) $3,000 October Sales Collection ($70000*75%) $52,500 November Sales Collection ($60000*20%) $12,000 Expected cash receipts for november $67,500

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.