Problem 29-8 Collections on receivables Here is a forecast of sales by National Bromide for the first four months of 2019 (figures in $ thousands): Month 1 Month 2 Month 3 Month 4 Cash sales Sales on credit 16 25 19 15 110 130 100 80 On the average 51% of credit sales are paid for in the current month, 31% are paid in the next month, and the remainder are paid in the month after that. What is the expected cash inflow from operations in months 3 and 4? (Do not round intermediate calculations. Enter your answers in thousands rounded to the nearest whole number.) Expected Cash Inflow from Operations (in $ thousands) Month 3 Month 4 Problem 29-12 Short-term financial plans a. Paymore places orders for goods equal to 75% of its sales forecast for the next quarter. What will orders be in each quarter of the coming year if the sales in the current quarter are expected to be $320 and the sales forecasts for the next five quarters are as follows? Quarter in Coming Year Third Following Year First Quarter 386 First Second Fourth Sales forecast, $ 380 359 343 337 b. Paymore pays for two-thirds of the purchases immediately and pays for the remaining purchases in the next quarter. Calculate Paymore's cash payments in the coming year. c. Paymore's customers pay their bills with a two-quarter delay. What are the expected cash receipts from sales in the coming year? Assume Paymore began operations in the coming year and so has no sales in periods prior to Q1. d. Now suppose that Paymore's other expenses are $96 a quarter. Calculate the expected net cash flow for each qu the coming year. e. Suppose that Paymore's starting cash balance is $41 and its minimum acceptable balance is $25. Work out the short-term financing requirements for the coming year. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E
Problem 29-8 Collections on receivables Here is a forecast of sales by National Bromide for the first four months of 2019 (figures in $ thousands): Month 1 Month 2 Month 3 Month 4 Cash sales Sales on credit 16 25 19 15 110 130 100 80 On the average 51% of credit sales are paid for in the current month, 31% are paid in the next month, and the remainder are paid in the month after that. What is the expected cash inflow from operations in months 3 and 4? (Do not round intermediate calculations. Enter your answers in thousands rounded to the nearest whole number.) Expected Cash Inflow from Operations (in $ thousands) Month 3 Month 4 Problem 29-12 Short-term financial plans a. Paymore places orders for goods equal to 75% of its sales forecast for the next quarter. What will orders be in each quarter of the coming year if the sales in the current quarter are expected to be $320 and the sales forecasts for the next five quarters are as follows? Quarter in Coming Year Third Following Year First Quarter 386 First Second Fourth Sales forecast, $ 380 359 343 337 b. Paymore pays for two-thirds of the purchases immediately and pays for the remaining purchases in the next quarter. Calculate Paymore's cash payments in the coming year. c. Paymore's customers pay their bills with a two-quarter delay. What are the expected cash receipts from sales in the coming year? Assume Paymore began operations in the coming year and so has no sales in periods prior to Q1. d. Now suppose that Paymore's other expenses are $96 a quarter. Calculate the expected net cash flow for each qu the coming year. e. Suppose that Paymore's starting cash balance is $41 and its minimum acceptable balance is $25. Work out the short-term financing requirements for the coming year. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Problem 29-8 Collections on receivables
Here is a forecast of sales by National Bromide for the first four months of 2019 (figures in $ thousands):
Month 1
Month 2
Month 3
Month 4
Cash sales
Sales on credit
16
25
19
15
110
130
100
80
On the average 51% of credit sales are paid for in the current month, 31% are paid in the next month, and the remainder are paid
in the month after that. What is the expected cash inflow from operations in months 3 and 4? (Do not round intermediate
calculations. Enter your answers in thousands rounded to the nearest whole number.)
Expected Cash Inflow from
Operations (in $ thousands)
Month 3
Month 4
Transcribed Image Text:Problem 29-12 Short-term financial plans
a. Paymore places orders for goods equal to 75% of its sales forecast for the next quarter. What will orders be in each quarter
of the coming year if the sales in the current quarter are expected to be $320 and the sales forecasts for the next five
quarters are as follows?
Quarter in Coming Year
Third
Following Year
First Quarter
386
First
Second
Fourth
Sales forecast, $
380
359
343
337
b. Paymore pays for two-thirds of the purchases immediately and pays for the remaining purchases in the next quarter.
Calculate Paymore's cash payments in the coming year.
c. Paymore's customers pay their bills with a two-quarter delay. What are the expected cash receipts from sales in the coming
year? Assume Paymore began operations in the coming year and so has no sales in periods prior to Q1.
d. Now suppose that Paymore's other expenses are $96 a quarter. Calculate the expected net cash flow for each qu
the coming year.
e. Suppose that Paymore's starting cash balance is $41 and its minimum acceptable balance is $25. Work out the short-term
financing requirements for the coming year.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
Required D
Required E
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