value: 10.00 points Martin Clothing Company is a retail company that sells hikin

Question

value: 10.00 points Martin Clothing Company is a retail company that sells hiking and other outdoor gear specially made for the desert heat. It sells to individuals as well as local companies that coordinate adventure getaways in the desert for tourists. The following information is available for several months of the current year Cash Expenses Month May June July August Sales Purchases Paid 115,000 140,000 134,000 S 99,000 S61,000 22,000 90,000 111,000 74,000 29,500 37,250 30,100 The majority of Martin's sales (70 percent) are cash, but a few of the excursion companies purchase on credit. Of the credit sales, 45 percent are collected in the month of sale and 55 percent are collected in the following month. All of Martin's purchases are on account with 40 percent paid in the month of purchase and 60 percent paid the following month. Required 1. Determine budgeted cash collections for July and August. (Round your intermediate calculations and final answers to nearest whole dollar.) July August Budgeted Cash Collections 2. Determine budgeted cash payments for July and August. July August Budgeted Cash Payments

Explanation / Answer

SOLUTION

(A) Budgted cash collections-

(B) Budgeted cash payments-

July ($) August ($) Cash sales: July sales ($140,000 * 70%) 98,000 August sales ($134,000 * 70%) 93,800 Credit sales: June sales ($115,000 * 30% * 55%) 18,975 July sales ($140,000 * 30% * 45%) , ($140,000 * 30% * 55%) 18,900 23,100 August sales ($134,000 * 30% * 45%) 18,090 Budgeted cash collections 135,875 134,990

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