Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:o Sales are budgeted at $220,000 for November, $200,000 for December, and $210,000 for January.o Collections are expected to be 70% in the month of sale, 27% in the month following the sale, and 3% uncollectible.o The cost of goods sold is 65% of sales.o The company desires to have an ending merchandise inventory at the end of each month equal to 50% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase.o Other monthly expenses to be paid in cash are $22,500.o Monthly depreciation is $19,000.o Ignore taxes. Expected cash collections in December are: *
Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:o Sales are budgeted at $220,000 for November, $200,000 for December, and $210,000 for January.o Collections are expected to be 70% in the month of sale, 27% in the month following the sale, and 3% uncollectible.o The cost of goods sold is 65% of sales.o The company desires to have an ending merchandise inventory at the end of each month equal to 50% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase.o Other monthly expenses to be paid in cash are $22,500.o Monthly depreciation is $19,000.o Ignore taxes. Expected cash collections in December are: *
Chapter1: Financial Statements And Business Decisions
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:o Sales are budgeted at $220,000 for November, $200,000 for December, and $210,000 for January.o Collections are expected to be 70% in the month of sale, 27% in the month following the sale, and 3% uncollectible.o The cost of goods sold is 65% of sales.o The company desires to have an ending merchandise inventory at the end of each month equal to 50% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase.o Other monthly expenses to be paid in cash are $22,500.o Monthly depreciation is $19,000.o Ignore taxes. Expected cash collections in December are: *
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