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Current Asset Management Solutions 19

# Current Asset Management Solutions 19 - Net Income 21...

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Old Exam Questions - Current Asset Management - Solutions Page 19 of 21 Pages Net Income \$42,000.00 \$53,328.00 21. Assume that your company is constructing a monthly cash budget for the month of May, June, and July. You have been given the following data: It is currently the end of April (beginning of May). Actual sales were \$2,000 in March and \$1,500 in April. Forecasted sales are \$1,800 for May, \$2,300 for June, and \$2,800 for July. Collections of sales are 20 percent in the month of sale, 55 percent the month after sale, and 20% two months after sale. Monthly expenses include salaries = \$100; lease = \$50; depreciation = \$50, miscellaneous = \$50; and a tax payment of \$250 in July. Purchases and wages are equal to 80 percent of the current month's sales, but
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