e debtors collection period of JK Limited
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The debtors collection period of JK Limited for 2023 is expected to be 36.5 days and the creditors payment period is estimated to be 73 days.
The
A. R1 080 000
OB. R540 000
OC. R7 884 000
D. R3 942 000
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- LONG-TERM FINANCING NEEDED At year-end 2019, total assets for Arrington Inc. were 1.8 million and accounts payable were 450,000. Sales, which in 2019 were 3.0 million, are expected to increase by 25% in 2020. Total assets and accounts payable are proportional to sales, and that relationship will be maintained; that is, they will grow at the same rate as sales. Arrington typically uses no current liabilities other than accounts payable. Common stock amounted to 500,000 in 2019, and retained earnings were 475,000. Arrington plans to sell new common stock in the amount of 130,000. The firms profit margin on sates is 5%; 35% of earnings will be retained. a. What were Arringtons total liabilities in 2019? b. How much new long-term debt financing will be needed in 2020? (Hint: AFN - New stock = New long-term debt.)Prepare a Debtors Collection Schedule using the below information? INFORMATIONExtract of the Statement of Comprehensive Income for the month ended 31 May 2022Sales 100 000Cost of sales 50 000Rent income 2 500Advertising 5 000Salaries and wages 15 000Rates and taxes 900Other operating expenses 20 000Additional information1. Sales are expected to increase by 20% each month.2. Thirty percent (30%) of the sales is for cash and the balance is on credit. Collections from credit sales are asfollows:* 30% in the month of the sale, and these customers are entitled to a discount of 5%;* 65% in the month after the sale.The balance is usually written off as bad debts.3. Inventories are kept at a constant level. The business uses a fixed mark-up of 100% on cost. All purchases arefor cash.4. In terms of the lease agreement, the rental will increase by R3 000 per annum with effect from 01 July 2022. Rentis received monthly.5. Advertising is paid monthly and is estimated to be the same percentage of…Xanax Inc expects the following transaction in 2020. Their first year of operations.· Allowance for bad debts, end of year is 80,000· Sales (some receivables are collectible in 2021) 1,500,000· Bad debt written offs during the year 10,000· Disbursements of costs and expenses 1,200,000· Disbursements for income taxes 90,000· Accounts receivable, end of year, net- 70,000· Purchases of fixed assets for cash 400,000· Proceeds from issuance of ordinary shares 580,000· Proceed from short-term borrowings 100,000· Payments on short-term borrowings 60,000· Depreciation on fixed assets 80,000· Loss on sale of fixed assets (book value 100,000) 10,000What is the cash balance at December 31, 2020?
- Use the information provided below to prepare the Debtors Collection Schedule for January and February 2023:INFORMATIONThe following information was provided by Intel Enterprises:1. The bank balance on 31 December 2022 is expected to be R40 000 (unfavourable).2. Credit sales are expected to be as follows:December 2022 - R576 000 January 2023 - R540 000 February 2023 - R648 0003. Credit sales usually make up 40% of the total sales. Cash sales make up the balance. Cash customersreceive a 10% discount.4. Credit sales are normally collected as follows:* 30% in the month in which the transaction takes place, and these customers are entitled to a 5% discount.* 65% in the following monthThe rest is usually written off as bad debts.5. Budgeted purchases of inventory are as follows:December 2022 - R1 000 000 January 2023 - R800 000 February 2023 - R920 000The following are the account balances for Nguyen Ltd as at 31st December 2018 Mortgage $ 210,000.00 Inventory $ 60,000.00 Owners Equity $ 360,000.00 Investments (Shares) $ 11,000.00 Plant (net) $ 61,000.00 Land and Building $ 327,629.00 Accounts Payable $ 31,000.00 Cash at Bank $ 5,000.00 Accounts Receivable $ 136,371.00 Nguyen Ltd wants budgets prepared for the next six months. The expected credit sales for the six months ending 30th June 2019 (there are no cash sales) are as follows: Estimated Sales (units) Jan Feb March April May June July Assuming poor Market 15,000.00 10,000.00 8,000.00 7,000.00 10,000.00 10,000.00 10,000.00 Accounts Receivable are collected in the following pattern: 60% of accounts are settled in the first month following the month of sale 3% discount will be available to 25% of those paying…Below are PT KMK projected quarterly sales for 2020. Q1 Q2 Q3 Q4 Sales 175 145 230 200 Supposed at the beginning of the year, account receivables are $250. PT KMK has a 30-day collection period. Please calculate a) cash collection in each of the four quarters!b) Rework question (a) assuming a collection period of 70 days.c) Rework question (a) assuming a collection period of 45 days.Notes: Number of days in one quarter is 90 days
- Use the information provided below to prepare the following for January and February 2023 as per guide lines on theouc4.1 Debtors Collection Schedule INFORMATIONThe following information was provided by Intel Enterprises:1. The bank balance on 31 December 2022 is expected to be R40 000 (unfavourable).2. Credit sales are expected to be as follows:December 2022 January 2023 February 2023R576 000 R540 000 R648 0003. Credit sales usually make up 40% of the total sales. Cash sales make up the balance. Cash customersreceive a 10% discount.4. Credit sales are normally collected as follows:* 30% in the month in which the transaction takes place, and these customers are entitled to a 5% discount.* 65% in the following monthThe rest is usually written off as bad debts.5. Budgeted purchases of inventory are as follows:December 2022 January 2023 February 2023R1 000 000 R800 000 R920 000 6. Fifty percent…Martin Corporation’s expected sales revenue for the 4th quarter of 2023 is as follows: Oct ............. $400,000Nov............. 450,000Dec ............ 500,000 All sales are on account (credit) with 50 percent collected in the month of sale, 30 percent collected in the month after sale, and 20 percent collected in the second month after sale. Assume there are no uncollectable accounts. Martin's cash collections in December are expected to be.Use the information provided below to prepare the following for January and February 2023:Debtors Collection Schedule The following information was provided by Intel Enterprises:1. The bank balance on 31 December 2022 is expected to be R40 000 (unfavourable).2. Credit sales are expected to be as follows:December 2022 January 2023 February 2023R576 000 R540 000 R648 0003. Credit sales usually make up 40% of the total sales. Cash sales make up the balance. Cash customersreceive a 10% discount.4. Credit sales are normally collected as follows:* 30% in the month in which the transaction takes place, and these customers are entitled to a 5% discount.* 65% in the following monthThe rest is usually written off as bad debts.5. Budgeted purchases of inventory are as follows:December 2022 January 2023 February 2023R1 000 000 R800 000 R920 0004.26. Fifty percent (50%) of the purchases are for cash. The remainder is paid in the month after the purchase.7. The monthly salaries amount to R150 000.…
- Read the following information and answer the questions that follow.Cash balance as at 31/12/2021 was P5000Interest on savings is P100Long term loan taken in January 2022 was P25000, that will be paid in 5 yearsLoan repayment installment is P450 which will start end of February 2022Revenue for January was P15 000, February P18 000, March P20 000, April P19 000Salaries per month amount to P15 000Rental payment per month is P3 500Advertising and promotion is P1 000 paid once in two monthsTelephone expenses P500Utilities estimated at P1000 per monthBought a second hand mini tractor for P15 000 cash in February 2022 Required: a. Construct a cash budget for the first four months of 2022. b. Identify and briefly explain three reasons for a cash budget.The Purchases of inventories by GH Stores for 2023 were forecast at R3 240 000, of which 40% is expected to be on credit. The debtors collection period is estimated to be 73 days and the creditors payment period is forecasted at 36.5. how much is expected to be owed to the creditors at the end of 2023?X Corporation expects the following transaction in 2020. Their first year of operations.· Allowance for bad debts, end of year is 80,000· Sales (some receivables are collectible in 2021) 1,500,000· Bad debt written offs during the year 10,000· Disbursements of costs and expenses 1,200,000· Disbursements for income taxes 90,000· Accounts receivable, end of year, net- 70,000· Purchases of fixed assets for cash 400,000· Proceeds from issuance of ordinary shares 580,000· Proceed from short-term borrowings 100,000· Payments on short-term borrowings 60,000· Depreciation on fixed assets 80,000· Loss on sale of fixed assets (book value 100,000) 10,000What is the cash balance at December 31, 2020? a. 470,000 b. 300,000 c. 390,000 d. 370,000 e. None of the above
