November December January February MarchSales $9,500 $10,000 $11,000 $12,100 $13,310All sales are for credit, with 80% collected the following month and 20% collected duringthe second month. Purchases of raw materials equals 60% of sales. Purchases aremade in the month of the sale, but suppliers are paid in the month following thepurchase. Wages are $1,000 per month, rent is $1,500, taxes are $500, and a $1,000loan payment is due in February. Monthly interest expense is $200. What are the netcash flows in January, February, and March?

The objective of the question is to calculate the net cash flows for the months of January,…

Answered: November December January February…

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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Acme Ltd. manufactures point of sale terminals used by businesses to process transactions. At the close of business on 30 September, the company had 450 terminals in inventory. The company's policy is to maintain an ending inventory of terminals equal to 30 per cent of next month's sales. Each terminal manufactured requires 25 minutes of assembly and inspecting time at a cost of 70 cents per minute. The company expects the following sales activity: October 8 000 units November 12 000 units December 13 000 units January 10 000 units What is the total projected direct labour cost for November and December? O $302 000 O None of the other alternatives $210 000 O $427 000
Marwick’s Pianos, Inc., purchases pianos from a large manufacturer for an average cost of $1,499 per unit and then sells them to retail customers for an average price of $2,600 each. The company’s selling and administrative costs for a typical month are presented below: Costs Cost Formula Selling: Advertising $ 961 per month Sales salaries and commissions $ 4,799 per month, plus 4% of sales Delivery of pianos to customers $ 60 per piano sold Utilities $ 647 per month Depreciation of sales facilities $ 4,956 per month Administrative: Executive salaries $ 13,422 per month Insurance $ 702 per month Clerical $ 2,456 per month, plus $37 per piano sold Depreciation of office equipment $ 879 per month During August, Marwick’s Pianos, Inc., sold and delivered 56 pianos. Required: 1. Prepare a traditional format income statement for August.
Dick's Draperies has gross sales $15,000 per month, half of which are on credit (paid with 30 days). Monthly expenses are as follows: wages, $3,000; utilities and rent, $2,000; advertising, $300; and miscellaneous, $500, inventory is purchased every three months and totals $30,000 for each order. Yearly expenses paid for in advance are insurance of $1,000 and a rent deposit of $700. Prepare a six-month cash flow statement for Dick's Draperies. What advice would you give this business based on the cash flow statement?
For February, sales revenue is $610,000, sales commissions are 7% of sales, the sales manager's salary is $91,600, advertising expenses are $92,700, shipping expenses total 3% of sale, and miscellaneous selling expenses are $2,200 plus 1/2 of 1% of sales. Total selling expenses for the month of February are a.$247,500 b.$250,550 c.$186,500 d.$229,200
QUESTION 1 REQUIRED Prepare the Cash Budget for a project of Aston Enterprises for the period 01 May 2021 to 31 July 2021. (Ensure that your cash budget has separate monetary columns for each month.) INFORMATION The following information was provided by Aston Enterprises: 1. The bank balance on 30 April 2021 is expected to be R50 000 (favourable). 2. Expected sales (excluding discounts) are as follows: April May June July R R R. R Cash sales 100 000 120 000 160 000 170 000 Credit sales 140 000 150 000 180 000 230 000 3. A discount of 5% is given to customers on cash sales. 4. Customers who purchase on credit usually pay one month after the sale. 5. The production estimates reveal the following: Production costs March April May June July R R R R R Direct materials 75 000 77 000 45 000 55 000 60 000 Direct labour 32 000 35 000 36 000 39 000 41 000 Overheads 25 000 27 000 29 000 33 000 35 000
Sherman Company provides services in the retail flooring industry. The following information is available for 20x5: Twenty percent of the firm's services are for cash and the remaining 80% are on account. Of the credit services, 40% are collected in the month that the service is provided, with the remaining 60% collected in the following month. Services provided in January are expected to total $250,000 and grow at the rate of 5% per month thereafter. January's cash collections are expected to be $240,400, and month-end receivables are forecast at $120,000. Monthly cash operating costs and depreciation during the first quarter of the year are approximated at $250,000 and $15,000, respectively. Sherman's December 31, 20x4 balance sheet revealed accounts payable balances of $28,000. This amount is related to the company's operating costs and is expected to grow to $36,000 by the end of 20x5's first quarter. All operating costs are paid within 30 days of incurrence. Company policy…
Zachary Corporation paid one of its sales representatives $8,500 during the month of March. The rep is paid a base salary plus $11 per unit of product sold. During March, the rep sold 170 units. Required Calculate the total monthly cost of the sales representative's salary for each of the following months. Month Number of units sold i Total variable cost Total fixed cost Total salary cost $ April 210 0 $ May 120 0 $ June 220 0 $ July 130 0
ABC Company manufactures and sells lighting fixtures. Estimated sales for the next three months are; September – $350,000 October – $500,000 November – $400,000 Sales for August were $400,000. All sales are on account, ABC Company estimates that 60% of the accounts receivable are collected in the month of sale with the remaining 40% collected the following month. The units sell for $30 each. The cash balance for September 1 is $100,000. Generally, 60% of purchases are due and payable in the month of purchase with the remainder due the following month. Purchase cost per unit for materials is $18. The company maintains an end-of-the-month inventory of 1,000 units plus 10% of next month's unit sales. In addition to the information given, selling and administrative expenses paid in cash are $120,000 per month. Requirement: Prepare a monthly cash budget for September and October for ABC Company.
Sports Socks has a policy of always paying within the discount period and each of its suppliers provides a discount of 2% if paid within 10 days of purchase. Because of the purchase policy, 85% of its payments are made in the month of purchase and 15% are made the following month. The direct materials budget provides for purchases of $133,000 in November, $298,000 in December, $240,000 in January, and $225,000 in February. What is the balance in accounts payable for January 31, and February 28? Ending Balance January $fill in the blank 1 February fill in the blank 2
For February, sales revenue is $620,000, sales commissions are 6% of sales, the sales manager's salary is $80,300, advertising expenses are $80,200, shipping expenses total 2% of sale, and miscellaneous selling expenses are $2,700 plus 1/2 of 1% of sales. Total selling expenses for the month of February are O $212,800 O b. $200,400 O c. $215,900 Od $163,200
For February, sales revenue is $606,000; sales commissions are 5% of sales; the sales manager's salary is $91,600; advertising expenses are $81,900; shipping expenses total 4% of sales; and miscellaneous selling expenses are $3,000 plus 1/2 of 1% of sales. Total selling expenses for the month of February are Oa. $176,500 Ob. $206,800 Oc. $234,070 Od. $231,040

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