201-SELF STUDY PROB-WEEK 12-S'12

201-SELF STUDY PROB-WEEK 12-S'12 - !"# % &'()...

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Unformatted text preview: !"# % &'() &*+,- ./01('2& 3 &0(+*405& % 6''7 #! 8%9": 8%9!: 8%9; .<=>?@A 8%9" 1BCD@E@C FGHIHJGI? KEIE@A@HEKL <@EIG?@< EXERCISE 9-30 (30 MINUTES) 1. Budgeted cash collections for December: Month of Sale Collections in December November ............................................................. $200,000 ! 38% $ 76,000 December ............................................................. 220,000 ! 60% 132,000 Total cash collections ......................................... $208,000 2. Budgeted income (loss) for December: Sales revenue ........................................................................ $220,000 Less: Cost of goods sold (75% of sales) ............................ 165,000 Gross margin (25% of sales) ............................................... $ 55,000 Less: Operating expenses: .................................................. Bad debts expense (2% of sales) .............................. $ 4,400 Depreciation ($216,000/12) ........................................ 18,000 Other expenses .......................................................... 22,600 Total operating expenses .......................................... 45,000 Income before taxes ............................................................. $ 10,000 3. Projected balance in accounts payable on December 31: The December 31 balance in accounts payable will be equal to December's purchases of merchandise. Since the store's gross margin is 25 percent of sales, its cost of goods sold must be 75 percent of sales. Month Sales Cost of Goods Sold Amount Purchased in December December ................... $220,000 $165,000 $165,000 ! 20% $ 33,000 January ....................... 200,000 150,000 150,000 ! 80% 120,000 Total December purchases ................ purchases ....
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This note was uploaded on 02/23/2012 for the course MGMT 201 taught by Professor Rowe during the Spring '08 term at Purdue University-West Lafayette.

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201-SELF STUDY PROB-WEEK 12-S'12 - !"# % &'()...

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