Cantave projected the following for 2015: Accrual of salaries and wages at Decem
ID: 2454837 • Letter: C
Question
Cantave projected the following for 2015:
Accrual of salaries and wages at December 31, 2015, $8,000
Depreciation expense, $20,000
Collections from customers, $197,000
Credit sales, $210,000
Merchandise purchases during 2015, $95,000 (All but 20% will be paid by December 31, 2015)
Cost of goods sold, $92,000
Loan repayments, $15,000 principal + $700 interest
Dividend declared on Dec. 18, 2015, $12,000
Current period cash operating expenses, $80,000
Cash balance, Jan. 1, 2015, $36,000
How much is cash to be reported on Contave’s budgeted balance sheet at the end of 2015?
Accrual of salaries and wages at December 31, 2015, $8,000
Depreciation expense, $20,000
Collections from customers, $197,000
Credit sales, $210,000
Merchandise purchases during 2015, $95,000 (All but 20% will be paid by December 31, 2015)
Cost of goods sold, $92,000
Loan repayments, $15,000 principal + $700 interest
Dividend declared on Dec. 18, 2015, $12,000
Current period cash operating expenses, $80,000
Cash balance, Jan. 1, 2015, $36,000
Explanation / Answer
$36,000 + $197,000 - $15,700 - $76,000 - $80,000 = $61,300
Purchases paid: 80%*$95,000 = $76,000
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