Toyz is a large discount toy store in Valley Wood Mall. The store typically has slow sales in thesummer months that increase dramatically and rise to a peak at Christmas. During the summer andfall, the store must build up its inventory to have enough stock for the Christmas season. Topurchase and build up its stock during the months when its revenues are low, the store borrowsmoney.Following is the store's projected revenue and liabilities schedule for July through December(where revenues are received and bills are paid at the first of each month):MonthRevenuesLiabilitiesJulyAugustSeptemberOctober$20,00030,00040,000$60,00060,00080,00030,00030,00020,00050,000NovemberDecember80,000100,000At the beginning of July, the store can take out a 6-month loan that carries an 11% interest rateand must be paid back at the end of December. The store cannot reduce its interest payment bypaying back the loan early. The store can also borrow money monthly at a rate of 5% interest permonth.Money borrowed on a monthly basis must be paid back at the beginning of the next month. Thestore wants to borrow enough money to meet its cash flow needs while minimizing its cost ofborrowing. Formulate a linear programming model for this problem.[12]

Solution: Linear Programming model is as follows : Decision variables: X = Six-month loan quantity…

Toyz is a large discount toy store in Valley Wood Mall. The store typically has slow sales in the summer months that increase dramatically and rise to a peak at Christmas. During the summer and fall, the store must build up its inventory to have enough stock for the Christmas season. To purchase and build up its stock during the months when its revenues are low, the store borrows money.

Toyz is a large discount toy store in Valley Wood Mall. The store typically has slow sales in the summer months that increase dramatically and rise to a peak at Christmas. During the summer and fall, the store must build up its inventory to have enough stock for the Christmas season. To purchase and build up its stock during the months when its revenues are low, the store borrows money.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Ethics Case Electronics, Inc. is a high-volume, wholesale merchandising company. Most of its inventory turns over four or five times a year. The company has had 50 units of a particular brand of computers on hand for over a year. These computers have not sold and probably will not sell unless they are discounted 60 to 70%. The accountant is carrying them on the books at cost and intends to recognize the loss when they are sold. This way, she can avoid a significant write-down in inventory on the current year’s financial statements. 1. Is the accountant correct in her treatment of the inventory? Why or why not? 2. If the computers cost $1,000 each and their market value is 40% of their cost, journalize the entry necessary for the write-down. 3. In groups of three or four, make a list of reasons why inventories of electronic equipment might have to be written down.
Beached is a retail outlet situated in a very popular tourist town not far from Canberra. It is very popular during school holidays, with the peak tourist season being in December and January. Sales consist of cash sales to retail customers (70%) and credit sales to tourist operators (30%). Credit sales are collected 20% in the month of sale, 60% in the month following the sale and 20% in the second month following the sale. Opening Accounts Receivable are $120,000. Inventory is marked-up 70% on cost and inventory opening balances are required to be 60% of the month's expected sales. Inventory is purchased on credit with 40% paid in the month following the purchase and the remainder paid two months following the purchase. Opening Accounts Payable is $80,000. Using tha above information, prepare the following: 1. Prepare a cash receipts budget for the six months 2. Prepare a cash payments budget for the six months 3. Prepare a budgeted pfofit and loss to Gross Profit for the six months…
Moorcroft's assistant controller suggested that Moorcroft hire a part time collector to encourage customers to pay more promptly and to reduce the amount of uncollectible accounts. Sales are still 40% cash and 60% credit but the assistant controller predicted that this would cause credit sales to be collected 30% in the month of the sale, 50% in the month following sale, and 18% in the second month following sale; 2% are uncollectible. Prepare a schedule of expected collections from customers for June. How did these changes impact cash collections? Moorcroft Company Schedule of Expected Collections from Customers Sales April May June $ 173420 $ 191400 $ i 86710 i $ 173420 299000 330000 398000 $ i 340500 $ 230840 99000 32292 202932
Help PL
Please help me
Beauty Salon serves an approximate 1,200 customers annually. These are the breakdown of its customers: Teens - 500 Middle Age - 450 Senior Citizen - 250 All customers spend an average of Php500.00 per visit.Assuming the customers visit DEFG Salon every 2 months, what is the projected annual market size for Beauty Salon? However, during the 3-month lockdown, salons are not allowed to operate.What is the projected loss in revenues for DEFG Salon?
BAYWEST Stationery & Supplies located in Montego Bay, Jamaica, sells a variety of school supplies including several brands of tablets. The business uses a perpetual inventory system and adjusts cost of goods sold for any shortage or excess inventory. BAYWEST began the third quarter (July to September) of 2020 with 30 (Alcatel) tablets at a total cost of $187,800. During the quarter, with the onset of the COVID-19 pandemic, the business completed the following transactions relating to the “Alcatel” tablets. Subpart (D) to be solved July 31 - The sales for July were 85 tablets which yielded total sales revenue of $809,030. (25 of these tablets were sold on account to longstanding customers) August 4 - A new batch of 67 tablets was purchased at a total cost of $465,650 August 10 - 5 of the tablets purchased on August 4 were returned to the supplier, as they were not of the model ordered. August 31 - During the month 60 tablets were sold at a price of $10,350 each. September 4 -…
Hult Games buys electronic components for manufacturing from two suppliers, Milan Components and Dundee Parts. If the components are delivered late, the shipment to the customer is delayed. Delayed shipments lead to contractual penalties that call for Hult to reimburse a portion of the purchase price to the customer. During the past quarter, the purchasing and delivery data for the two suppliers showed the following. Milan Dundee Total Total purchases (cartons) 98,000 42,000 140,000 Average purchase price (per carton) $ 20.00 $ 22 $ 20.60 Number of deliveries 80 20…