19-27 DY Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: • Sales are budgeted at P290,000 for November, P310,000 for December, and P210,000 for January. Collections are expected to be 65% in the month of sale, 33% in the month following the sale, and 2% uncollectible. • The cost of goods sold is 80% of sales. The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are P21,100. Monthly depreciation is P21,000.Ignore taxes. Statement of Financial Position October 31 Assets: Cash Accounts receivable (net of allowance for uncollectible accounts) Inventory Property, plant and equipment (net of P624,000 accumulated depreciation) Total assets Liabilities and Stockholders' Equity: Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity 19. Expected cash collections in December are: A) P310,000 B) P95,700 20. The cost of December merchandise purchases would be: A) P248,000 B) P232,000 C) P297,200 C) P117,600 21.December cash disbursements for merchandise purchases would be: A) P192,000 B) P243,200 C) P117,600 P 25,000 77,000 162,400 1,026,000 P1.290,400 P 239,000 740,000 311,400 P1.290.400 D) P201,500 D) P192,000 D) P248,000
19-27 DY Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: • Sales are budgeted at P290,000 for November, P310,000 for December, and P210,000 for January. Collections are expected to be 65% in the month of sale, 33% in the month following the sale, and 2% uncollectible. • The cost of goods sold is 80% of sales. The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are P21,100. Monthly depreciation is P21,000.Ignore taxes. Statement of Financial Position October 31 Assets: Cash Accounts receivable (net of allowance for uncollectible accounts) Inventory Property, plant and equipment (net of P624,000 accumulated depreciation) Total assets Liabilities and Stockholders' Equity: Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity 19. Expected cash collections in December are: A) P310,000 B) P95,700 20. The cost of December merchandise purchases would be: A) P248,000 B) P232,000 C) P297,200 C) P117,600 21.December cash disbursements for merchandise purchases would be: A) P192,000 B) P243,200 C) P117,600 P 25,000 77,000 162,400 1,026,000 P1.290,400 P 239,000 740,000 311,400 P1.290.400 D) P201,500 D) P192,000 D) P248,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Provide solution for numbers 19 to 27
Transcribed Image Text:19-27 DY Farm Supply is located in a small town in the rural west. Data regarding the store's operations
follow:
• Sales are budgeted at P290,000 for November, P310,000 for December, and P210,000 for January.
Collections are expected to be 65% in the month of sale, 33% in the month following the sale, and 2%
uncollectible.
•
•
The cost of goods sold is 80% of sales.
The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in
the month of sale. Payment for merchandise is made in the month following the purchase.
Other monthly expenses to be paid in cash are P21,100.
Monthly depreciation is P21,000.Ignore taxes.
Statement of Financial Position
October 31
Assets:
Cash
Accounts receivable (net of allowance for uncollectible accounts)
Inventory
Property, plant and equipment (net of P624,000 accumulated depreciation)
Total assets
Liabilities and Stockholders' Equity:
Accounts payable
Common stock
Retained earnings
Total liabilities and stockholders' equity
19. Expected cash collections in December are:
A) P310,000
B) P95,700
20. The cost of December merchandise purchases would be:
A) P248,000
B) P232,000
C) P117,600
21.December cash disbursements for merchandise purchases would be:
A) P192,000
B) P243,200
C) P117,600
23. The net income for December would be:
A) P13,700
22. The excess (deficiency) of cash available over disbursements
A) P46,600
B) P19,200
B) P32,900
24. The cash balance at the end of December would be:
A) P63,300
B) P25,000
25. The accounts receivable balance, net of uncollectible
A) P102,300
B) P198,000
C) P297,200
26. Accounts payable at the end of December would be:
A) P192,000
B) P248,000
27. Retained earnings at the end of December would be:
A) P325,100
B) P311,400
C) P40,900
P 25,000
77,000
162,400
1,026,000
P1.290,400
C) P117,600
P 239,000
740,000
311,400
P1.290.400
for December would be:
C) P13,700
C) P335,200
D) P201,500
D) P192,000
D) P248,000
D) P32,900
C) P57,900
D) P38,300
accounts, at the end of December would be:
C) P83,200
D) P108,500
D) P19,900
D) P74,400
D) P347,200
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