Calgon Products, a distributor of organic beverages, needs a cash budget for Sep

Question

Calgon Products, a distributor of organic beverages, needs a cash budget for September. The following information is available:

Sales on account are collected over a three-month period as follows: 10% collected in the month of sale, 70% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible.

Purchases of inventory will total $30,000 for September. Thirty percent of a month's inventory purchases are paid for during the month of purchase. The accounts payable remaining from August's inventory purchases total $20,000, all of which will be paid in September.

a. The cash balance at the beginning of September is $14,300. b. Actual sales for July and August and expected sales for September are as follows:

Explanation / Answer

calgon products a distributor of organic beveragescalgon products a distributor of organic beveragescalgon products a distributor of organic beverages

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