ezto.mhed The following information applies to the questions displayed below Azt
ID: 2422658 • Letter: E
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ezto.mhed The following information applies to the questions displayed below Aztec Company sells its product for $150 per unit. Its actual and projected sales follow. Units Dollars April (actual May (actual) June (budgeted) July (budgeted) August (budgeted 9,000 $1,350,000 360,000 7,000 050,000 7,500 540.000 2,400 1,125,000 540,000 3,600 All sales are on creat Recent experience shows that 22% of credit sales is collected in the month of the sale, 48% in the month after the sale. 25% in the second month after the sale, and 5% proves to be uncollectible. The product's purchase price is smo per unit. All purchases are payable within 11 days. Thus, 60% or purchases made in month is paid in that month and the other 40% is paid in the next month. The company has a policy to maintain an ending monthly inventory of 19% of the next month's unit sales plus a safety stock of 85 units. The Apri 30 and May 31 actual inventory levels are consistent with this pollcy. Seling and administrative expenses for the year are $1512.000 and are paid evenly throughout the year in cash. The company's minimum cash balance at month-end is $110000. This minimum is maintained, if necessary, by borrowing cash from the bank. If the balance exceeds $110,000, the company repays as much of the loan as t can without going below the minimum. This type of loan carries an annual 12% interest rate, on May 31, the oan balance is $41s00, and the company's cash balance is $110,000. (Round inal answers to the nearest whole dollar.) -5.00 points Requirod 1. Prepare a table that shows the computation of cash collections of its credit sales (accounts cash collections of its credit sal'es (accounts recevabie) n each of the months of June and July Percent Collected in April May July August Credit sales fromExplanation / Answer
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Percent collected in Particulars April May June July August Credit Sales From: April 22% 48% 25% May 22% 48% 25% June 22% 48% 25% July 22% 48% August 22% Amount collected in Particulars Total April May June July August Credit Sales From: April 1350000 297000 648000 337500 May 360000 79200 172800 90000 June 1050000 231000 504000 262500 July 1125000 247500 540000 August 540000 118800 Total 4425000 297000 727200 741300 841500 921300Related Questions
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