C-Cubed had the following information from the end of last year for its Mountain Bikes: Budgeted Bike Sales for October Budgeted Bike Sales for November Budgeted Bike Sales for December Desired Ending Finished Goods Inventory Cash Collected from Sales in November Cash Available on November 1 Cash Disbursements in November Interest Received During November Loan Payments Made During November The selling price for the Mountain Bikes is $75O. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 20% in the month of sale, 30% in the month following the sale, 115 bikes 120 bikes 100 bikes 15% of the following month's unit sales $40.000 $5.000 $25.000 S500 $8,000 and 50% in the second month following the sale. What is the budgeted accounts receivable balance at the end of December? Multiple Choice $52,500 $97,500 $60,000 $105,000
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Accounts receivable from November sales = November sales x % of amount receivable
= (120*$750)*50%
= $45,000
Accounts receivable from December sales = December sales x % of amount receivable
= (100*$750)*80%
= $60,000
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