127.Correy Inc.
reported the following information for 2012:
OctoberNovemberDecember
Budgeted sales$230,000$220,000$270,000
Budgeted purchases$120,000$128,000$144,000
All sales are on credit.
Customer amounts on account are collected 50% in the month of sale and 50% in the
following month.
Cost of goods sold is 35% of sales.
Correy purchases and pays for merchandise 60% in the month of acquisition and 40% in the
following month.
Accounts payable is used only for inventory acquisitions.
How much cash will Correy receive during November?
a.$110,000
b.$245,000
c.$225,000
d.$220,000
128.Correy Company reported the following information for 2012:
OctoberNovemberDecember
Budgeted sales$230,000$220,000$270,000
Budgeted purchases$120,000$128,000$144,000
Cost of goods sold is 35% of sales.
Correy purchases and pays for merchandise 60% in the month of acquisition and 40% in the
following month.
Accounts payable is used only for inventory acquisitions.
How much is the budgeted balance for Accounts Payable at October 31, 2012?
a.$48,000
b.$72,000
c.$102,000
d.$51,200
129.Petal Co. reported the following information for 2012:
Budgeted sales$620,000$580,000$720,000
All sales are on credit.
Customer amounts on account are collected 50% in the month of sale and 50% in the
following month.
How much is the November 30, 2012 budgeted Accounts Receivable?
a.$600,000
b.$360,000
c.$310,000
d.$290,000
130.Bean Manufacturing reported the following information for 2012:
OctoberNovemberDecember
Budgeted purchases$180,000$192,000$216,000
Operating expenses are: Salaries, $75,000; Depreciation, $30,000; Rent, $15,000; Utilities,
$21,000
Operating expenses are paid during the month incurred.
Accounts payable is used only for inventory acquisitions.
How much is the budgeted amount of cash to be paid for operating expenses in November?
a.$303,000
b.$111,000
c.$141,000
d.$333,000
131.During September, the capital expenditure budget indicates a $280,000 purchase of
equipment. The ending September cash balance from operations is budgeted to be $40,000.
The company wants to maintain a minimum cash balance of $20,000. What is the minimum
cash loan that must be planned to be borrowed from the bank during September?
a.$220,000
b.$240,000
c.$260,000
d.$300,000
132.Young Co. has budgeted its activity for December according to the following information:
1.Sales at $400,000, all for cash.
2.Budgeted depreciation for December is $10,000.
4.The cash balance at December 1 was $10,000.
5.Selling and administrative expenses are budgeted at $40,000 for December and are paid for
in cash.
6.The planned merchandise inventory on December 31 and December 1 is $12,000.
7.The invoice cost for merchandise purchases represents 75% of the sales price. All purchases
are paid in cash.
How much are the budgeted cash disbursements for December?
a.$230,000
b. $340,000
c. $350,000
d.$328,000
133.Dex Industries expects to purchase $90,000 of materials in March and $105,000
of materials in April. Three-quarters of all purchases are paid for in the month of purchase,
and the other one-fourth are paid for in the month following the month of purchase. In
addition, a 2% discount is received for payments made in the month of purchase. How much
will April's cash disbursements for materials purchases be?
a.$66,150
b.$81,150
c.$99,675
d.$90,000
134.On January 1, Witt Company has a beginning cash balance of $84,000. During the
year, the company expects cash disbursements of $680,000 and cash receipts of $580,000. If
Witt requires an ending cash balance of $80,000, Witt Company must borrow
a.$64,000.
b.$80,000.
c.$96,000.
d.$184,000.
135.Mapleview, Inc. has the following budgeted sales: July $100,000, August $150,000,
and September $125,000. 40% of the sales are for cash and 60% are on credit. For the credit
sales, 50% are collected in the month of sale, and 50% the next month. The total expected
cash receipts during September are
a.$140,000.
b.$132,500.
c.$131,250.
d.$125,000.
136.Burr, Inc.'s direct materials budget shows total cost of direct materials purchases
for April $300,000, May $360,000 and June $420,000. Cash payments are 60% in the month of
purchase and 40% in the following month. The budgeted cash payments for June are
a.$396,000.
b.$384,000.
c.$360,000.
d.$312,000.
Answer 127
c.$225,000
November
collection-50% in the month of sale $ 110,000
(50 % of $ 220,000 November Sales)
collection-50% in the following month $ 115,000
(50 % of $ 230,000 October Sales)
$ 225,000
Answer 128
a.$48,000
40 % of October purchases = 40 % of $ 120,000 = $ 48,000
Answer 129
d.$290,000
50 % of November Sales = 50 % of $ 580,000 = $ 290,000
Answer 130
b.$111,000
Operating expenses
Salaries $ 75,000
Rent $ 15,000
Utilities $ 21,000
$ 111,000
Answer 131
c.$260,000
Ending cash balance $ 40,000
less: minimum cash required $ 20,000
Cash available to use $ 20,000
Loan amount = Cash required for purchase of equipment less Cash available to use
Loan amount = $ 280,000 less $ 20,000 = $ 260,000
Answer 132
b. $340,000
selling and administrative expenses-paid in cash $ 40,000
purchases-paid in cash $ 300,000
(75 % of $ 400,000 Sales)
$ 340,000
Answer 133
c.$99,675
april
paid in same month $ 77,175
(3/4 * $ 105,000) less 2 % of (3/4 * $ 105,000)
1/4th of purchases of march $ 22,500
(1/4 * $ 90,000)
$ 99,675
84000
Answer 134 580000
c.$96,000.
Minimum cash balance required $ 80,000
add: disbursements $ 680,000
less: receipts $ 580,000
less: beginning cash balance $ 84,000
$ 96,000
Answer 135
b.$132,500.
September
Cash Sales $ 50,000
(40 % of $ 125,000 September sales)
50% of Credit Sales of September $ 37,500
(50 % of 60 % of $ 125,000)
50% of Credit Sales of August $ 45,000
(50 % of 60 % of $ 150,000)
$ 132,500
Answer 136
a.$396,000.
June
60% of June purchases $ 252,000
(60 % of $ 420,000)
40% of May purchases $ 144,000
(40 % of $ 360,000)
$ 396,000
Sales 230000 220000 270000
October
115000
105000
purchases
march
$ 90,000
$ 67,500
680000
80000
760000
96000
150000 125000
### $ 60,000 $ 50,000
$ 40,000 $ 90,000 $ 75,000
$ 60,000 $ 45,000 $ 37,500
$ 30,000 30000 45000
###
j
m 420000
a 360000 252000
300000 216000 144000
180000 120000 396000
