13) Roarie Enterprises Inc. prepared the following sales budget Month March Sale

Question

13) Roarie Enterprises Inc. prepared the following sales budget Month March SalesCredit Sales $18,000 $39,000 $35,000 $51,000 $13,000 May une $50,000 Credit collections are 25% in the month of sale, 60% in the following the sale. The remaining 5% is expected to be uncollectible. month following the sale, and 10% two months What are the total cash collections in June at Two Brothers Moving? A) $101,000 B) $39,600 C) $10,400 D) $90,600 14) Ocean Enterprises prepared the following sales budget Bud March $10,000 516,000 June The expected gross profit rate is 30% and the inventory at the end of February was $500. Desired inventory levels at the end of the month are 20% of the next month's cost of goods sold. What are the total purchases budgeted for May? A) $8400 B) $7840 C) $6160 D) $7000 15) MANGO Company collects 30% in the second month following sale, 60% in the month following sale and 10% of a month's sales in the month of sale. Budgeted sales for the upcoming four months are $90,000 $140,000 $230,000 sales May budgeted sales sales sales The amount of cash that will be collected in July is budgeted to be A) $180,000 B) $200,000 C) $212,000 D) $20,000 16) Oscar Hotdogs Corp expects to sell 6,000 hotdogs in January and 10,00 in February for $2 each. What will be the total sales revenue reflected in the sales budget for those months? A) January $5000; February $3000 C January $12,000; February $20,000 B) January $3000; February $5000 D) January $20,000; February $12,000 17) The human resources department for Kohl's Department Stores may be D) profit center A) investment center B) revenue center C) cost center

Explanation / Answer

Req 13. Answer is D. $ 90600 Explanation: Cash collections of June: Cash sales 51000 June credit sales (50000*25%) 12500 May credit sales (43000*60%) 25800 April Credit sales (13000*10%) 1300 Total Estimated collection 90600 Req 14. Answer is B. $ 7840 Explanation: COGS of May (10000*70%) 7000 Add: Desired ending inventory 2240 (16000*70% *20%) Total requirement 9240 Less: Desired beginning inventory 1400 ($ 7000*20%) Purchase budget in $ 7840 Req 15. Answer is B. $ 200000 Explanation: July sales (200000*10%) 20000 June month sales (230000*60%) 138000 May month sales (140000*30%) 42000 Total collections 200000 Req 16. Answer is C. Jan $12000 and Feb $20000 Explanation: Jan sales (6000 units @2) Feb sales (10000 units @2) Req 17. Answer is C. Cost Center

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