formation per Cash sales Credit sales Total sales November $ 112,000 304,000 $ 416,000 on's sales revenue is presented be December $ 141,000 466,000 $ 607,000 January $ 94,000 250,000 $ 344,000 Management estimates that 5% of credit sales are eventually uncollectible. Of the collectible credit sales, 60% are likely to be collected in the month of sale and the remainder in the month following the month of sale. The company desires to begin each month with an inventory equal to 70% of the sales projected for the month. All purchases of inventory are on open account: 20% will be paid in the month of purchase, and the remainder paid in the mom following the month of purchase. Purchase costs are approximately 50% of the selling prices. Budgeted December cash payments by Collection Corporation for December inventory purchases are:

formation per Cash sales Credit sales Total sales November $ 112,000 304,000 $ 416,000 on's sales revenue is presented be December $ 141,000 466,000 $ 607,000 January $ 94,000 250,000 $ 344,000 Management estimates that 5% of credit sales are eventually uncollectible. Of the collectible credit sales, 60% are likely to be collected in the month of sale and the remainder in the month following the month of sale. The company desires to begin each month with an inventory equal to 70% of the sales projected for the month. All purchases of inventory are on open account: 20% will be paid in the month of purchase, and the remainder paid in the mom following the month of purchase. Purchase costs are approximately 50% of the selling prices. Budgeted December cash payments by Collection Corporation for December inventory purchases are:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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