Use the following information to answer Questions 4 through 7 pressed gases to o

Question

Use the following information to answer Questions 4 through 7 pressed gases to other companies. Data regarding Weldon's operations follow Sales are all on and $310,000 for January account, and they are bulgeted at $300,000 for November, $320,000 for December lecti ns are expected to be 75% in the month of sale, 22% in the month following the sale. uncollectible The cost of goods sold is 70% of sales. . The company desires an ending merc following month. month following the purchase handise inventory equal to S0% of the cost of goods sold the andise is bought on account, and payment for merchandise is made in te Other monthly expenes to be paid in cash are $20.400 Monthly depreciation i $15,400 . Ignore taxes 4. How much are Weldon's total cash collections in December? A. 5306,000 B. $297.200 C. $301,600 D. $292,800 E. None of the above 5. How much are Weldon's total cash disbursements in December for merchandise purchase A. $234,080 B. $240,160 C. $237,120 D. $231,040 E. None of the above

Explanation / Answer

December Sales 320000 Accounts Receivable November sales 240000*22% 52800 December Sales 240000 Total Cash Collections 292800 Ans A 292800 5 November December Budgeted cost of goods sold 182400 243200 Add:Desired ending merchandised inventory 194560 206720 Total needs 376960 449920 Less:Beginning Merchandised Inventory 145920 194560 Required Purchases 231040 255360 Cash Disbursment Cash Disbursment for merchandised 231040 Other monthly cash expenses 20400 Total Cash Disbursment 251440 Ans D none of the above

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