Q) What are the expected cash collections for RelyaTech in December? Multiple Choice O $90,000 O $314,000 $224,000

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Q) What are the expected cash collections for RelyaTech in December?
Multiple Choice
O
O
$90,000
$314,000
$224,000
$320,000
D
Transcribed Image Text:Q) What are the expected cash collections for RelyaTech in December? Multiple Choice O O $90,000 $314,000 $224,000 $320,000 D
Data for RelyaTech, a large merchandiser, is below:
Sales are budgeted at $300,000 for November, $320,000 for December, and $220,000 for January.
Collections are expected to be 70% in the month of sale and 30% in the month following the sale.
• The cost of goods sold is 75% of sales.
• RelyaTech desires to have an ending merchandise inventory at the end of each month equal to 80% of the next month's cost of goods sold.
Payment for merchandise is made in the month following the purchase.
• Other monthly expenses to be paid in cash are $22,100.
• Monthly depreciation is $26,000.
• Ignore taxes.
. (ID#78786)
Assets
Cash
Balance Sheet
October 31
Accounts receivable
Merchandise inventory
Property, plant and equipment, net of $624,000 accumulated.
depreciation
Total assets
Liabilities and Stockholders' Equity
Accounts payable
Common stock
Show Transcribed Text
Common stock
Retained earnings
Total liabilities and stockholders' equity
C
30,000
82,000
186,400
1,014,000
$1,312,400
$ 246,000
750,000
750,000
316,400
$1,312,400
Transcribed Image Text:Data for RelyaTech, a large merchandiser, is below: Sales are budgeted at $300,000 for November, $320,000 for December, and $220,000 for January. Collections are expected to be 70% in the month of sale and 30% in the month following the sale. • The cost of goods sold is 75% of sales. • RelyaTech desires to have an ending merchandise inventory at the end of each month equal to 80% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase. • Other monthly expenses to be paid in cash are $22,100. • Monthly depreciation is $26,000. • Ignore taxes. . (ID#78786) Assets Cash Balance Sheet October 31 Accounts receivable Merchandise inventory Property, plant and equipment, net of $624,000 accumulated. depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Show Transcribed Text Common stock Retained earnings Total liabilities and stockholders' equity C 30,000 82,000 186,400 1,014,000 $1,312,400 $ 246,000 750,000 750,000 316,400 $1,312,400
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