Diltex Farm Supply is located in a small town in the rural west. Data regarding

Question

Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: ? Sales are budgeted at $200,000 for November, $220,000 for December, and $210,000 for January. ? Collections are expected to be 70% in the month of sale, 27% in the month following the sale, and 3% uncollectible. ? The cost of goods sold is 62% of sales. ? The company desires to have an ending merchandise inventory at the end of each month equal to 50% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase. ? Other monthly expenses to be paid in cash are $22,500. ? Monthly depreciation is $19,000. ? Ignore taxes. Statement of Financial Position October 31 Assets Cash $ 16,000 Accounts receivable (net of allowance for uncollectible accounts) 76,000 Merchandise inventory 71,500 Property, plant & equipment (net of $536,000 accumulated depreciation) 956,000 Total assets $1,119,500 Liabilities & Stockholders

Explanation / Answer

You will find your answer here. http://search.yahoo.com/search;_ylt=A0oG7lsRmJRQIHIARK5XNyoA?p=Diltex%20Farm%20Supply%20is%20located%20in%20a%20small%20town%20in%20the%20rural%20west.%20Data%20regarding%20the%20store's%20operations%20follow%3A%20%EF%82%B7%20Sales%20are%20budgeted%20at%20%24200%2C000%20for%20November%2C%20%24220%2C000%20for%20December%2C%20and%20%24210%2C000%20for%20January.%20%EF%82%B7%20Collections%20are%20expected%20to%20be%2070%25%20&fr2=sb-top&fr=yfp-t-701

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