Funnel Manufacturing Company has provided the follwoing information: Budgeted Sa
ID: 2431213 • Letter: F
Question
Funnel Manufacturing Company has provided the follwoing information:
Budgeted
Sales
$ 76,000
85,000
92,000
79,000
Budgeted Selling and Administrative Expenses Per Month are as follows:
Wages, $15,000
Advertising, $12,000
Depreciation, $3,000
Other, 4 percent of Sales
Cost of Goods Sold is 60% of Sales. All inventory is purchased in the month it is sold. Inventory purchases are paid 2/3 in the month of purchase, the remaining 1/3 paid in the following month.
The budgeted net income for February would be:
$600
$7,000
$5,300
$3,600
How much cash will be paid for purchases during the month of February?
$49,200
$45,600
$96,600
$51,000
What amount of Accounts Payable would be reported on the Balance Sheet at the end of February?
$28,333
$34,000
$17,000
$54,000
MonthBudgeted
Sales
$ 76,000
February85,000
March92,000
April79,000
Explanation / Answer
1) The budgeted net income for February would be: a.$600 Working: February # 1 Budgeted Sales $ 85,000 Cost of goods sold 51,000 Gross Profit 34,000 Selling and Administrative Expenss: Wages 15,000 Advertising 12,000 Depreciation 3,000 Other 3,400 33,400 Net Income 600 # 2 Other Expense = Budgeted Sales *4% = $ 85,000 *4% = $ 3,400 2) Cash will be paid for purchases during the month of February: a. $49,200 Working: January February Budgeted Sales 76,000 85,000 Cost of goods sold 45,600 51,000 February Purchase of last month 45,600 x 1/3 15,200 Purchase of current month 51,000 x 2/3 34,000 Cash will paid for the purchase 49,200 3) c.$17,000 Working: February Purchase of current month payable at the end of Month 51,000 x 1/3 17,000
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.