tion.con/hm.tpx Brarin Corporation Is a small wholesaler of gourmet food product

Question

tion.con/hm.tpx Brarin Corporation Is a small wholesaler of gourmet food products. Data regarding the store's operations follow Sales are budgeted at $310,000 for November, $320,000 for December, and $320,000 for January ·Collections are expected to be 75% in the month of sale, 24% In the month following the sale, and uncollectible The cost of goods sold is 70% of sales. The company would like to maintain ending merchandise inventories equal to 60% of the next month's cost of goods sold. Payment for merchandise is made In the month following the purchase. Other monthly expenses to be pald In cash are $20,800. Monthly depreclation Is $18,000. · . - Ignore taxes Balance Sheet October 31 Assets Cash Accounts recelvable, net of allowance for uncollectible accounts Merchandise inventory Property, plant and equipment, net of $626,000 accumulated depreclation Total assets $50,000 130,200 1,280,000 $1,558,200 Llabilities and Stockholders' Equity Accounts payable Common stock Retalned earnings Total Ilabltles and stockholders' equity $318,450 860,000 379,750 $1,558,200 December cash disbursements for merchandise purchases would be: O $212.800 O $224.000

Explanation / Answer

Calculate december cash disbursement for merchandise purchase :

so answer is c) $221200

November Cost of goods sold 217000 Add: Desired ending inventory (320000*70%*60%) 134400 Total needs 351400 Less: Beginning inventory (130200) Merchandise purchase 221200

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.