Martin Clothing Company is a retail company that sells hiking and other outdoor gear specially made for the desert heat. It sells to individuals as well as local companies that coordinate adventure getaways in the desert for tourists. The following information is available for several months of the current year: Month May June July August Sales $ 92,000 123,000 137,000 134,000 Purchases $ 60,000 93,000 110,000 78,000 Cash Expenses Paid $ 19,000 27,000 34,250 31,500 The majority of Martin's sales (65 percent) are cash, but a few of the excursion companies purchase on credit. Of the credit sales, 40 percent are collected in the month of sale and 60 percent are collected in the following month. All of Martin's purchases are on account with 60 percent paid in the month of purchase and 40 percent paid the following month. Required: 1. Determine budgeted cash collections for July and August. 2. Determine budgeted cash payments for July and August.
Martin Clothing Company is a retail company that sells hiking and other outdoor gear specially made for the desert heat. It sells to individuals as well as local companies that coordinate adventure getaways in the desert for tourists. The following information is available for several months of the current year: Month May June July August Sales $ 92,000 123,000 137,000 134,000 Purchases $ 60,000 93,000 110,000 78,000 Cash Expenses Paid $ 19,000 27,000 34,250 31,500 The majority of Martin's sales (65 percent) are cash, but a few of the excursion companies purchase on credit. Of the credit sales, 40 percent are collected in the month of sale and 60 percent are collected in the following month. All of Martin's purchases are on account with 60 percent paid in the month of purchase and 40 percent paid the following month. Required: 1. Determine budgeted cash collections for July and August. 2. Determine budgeted cash payments for July and August.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Martin Clothing Company is a retail company that sells hiking and other outdoor gear specially made for the desert heat. It
sells to individuals as well as local companies that coordinate adventure getaways in the desert for tourists. The following
information is available for several months of the current year:
Month
May
June
July
August
Sales
$ 92,000
123,000
137,000
134,000
Purchases
$ 60,000
93,000
110,000
78,000
Cash Expenses
Paid
$ 19,000
27,000
34,250
31,500
The majority of Martin's sales (65 percent) are cash, but a few of the excursion companies purchase on credit. Of the credit
sales, 40 percent are collected in the month of sale and 60 percent are collected in the following month. All of Martin's
purchases are on account with 60 percent paid in the month of purchase and 40 percent paid the following month.
Required:
1. Determine budgeted cash collections for July and August.
2. Determine budgeted cash payments for July and August.
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