The following information pertains to Monroe Company: Month Sales Purchases January $68,000 $35,000 February $87,000 $46,000 March $106,000 $58,000 Cash is collected from customers in the following manner: Month of sale 30% Month following the 70% sale 45% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month. Labor costs are 20% of sales. Other operating costs are $32,000 per month (including $8,000 of depreciation). Both of these are paid in the month incurred. The cash balance on March 1 is $8,900. A minimum cash balance of $6,000 is required at the end of the month. Money can be borrowed in multiples of $1,000. What is the ending cash balance for March? O $5,000 $6,000 $5,200 O $8,900
The following information pertains to Monroe Company: Month Sales Purchases January $68,000 $35,000 February $87,000 $46,000 March $106,000 $58,000 Cash is collected from customers in the following manner: Month of sale 30% Month following the 70% sale 45% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month. Labor costs are 20% of sales. Other operating costs are $32,000 per month (including $8,000 of depreciation). Both of these are paid in the month incurred. The cash balance on March 1 is $8,900. A minimum cash balance of $6,000 is required at the end of the month. Money can be borrowed in multiples of $1,000. What is the ending cash balance for March? O $5,000 $6,000 $5,200 O $8,900
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The following information pertains to Monroe Company:
Month
Sales
Purchases
January
$68,000
$35,000
February $87,000
$46,000
March
$106,000
$58,000
Cash is collected from customers in the following manner:
Month of sale
30%
Month following the
70%
sale
45% of purchases are paid for in cash in the month of
purchase, and the balance is paid the following month.
Labor costs are 20% of sales. Other operating costs are
$32,000 per month (including $8,000 of depreciation). Both of
these are paid in the month incurred.
The cash balance on March 1 is $8,900. A minimum cash
balance of $6,000 is required at the end of the month. Money
can be borrowed in multiples of $1,000.
What is the ending cash balance for March?
O $5,000
$6,000
O $5,200
O $8,900
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