In preparation for the quarterly cash budget, the following information have been compiled. Month Sales Purchases August (actual) P3,000,000.00 P3.500,000.00 September (actual) P4,500,000.00 P2,000,000.00 October (forecast) P1,000,000.00 P500,000.00 November (forecast) P1,500,000.00 P750,000.00 December (forecast) P2,000,000.00 P1,000,000.00 (a) Total cash receipt for the month of December is P1,850,000. (b) The firm pays cash for 40 percent of its purchases. (C) The firm pays for 60 percent of its purchases the following month. (d) Salaries and wages amount to 15 percent of the preceding month's sales. (e) Sales commissions amount to 2 percent of the preceding month's sales. (f) Rental payments of P100,000 must be made each month. (g) A principal and interest payment on an outstanding loan is due in December of P150,000. (h) The firm pays dividends of P50,000 at the end of the quarter. () Fixed assets costing P600,000 will be purchased in December. ) Depreciation expense each month of P45,000. How much is the net cash flows in December? A P390,000 B (P155,000) (c) (P430,000) D P135,000

In preparation for the quarterly cash budget, the following information have been compiled. Month Sales Purchases August (actual) P3,000,000.00 P3.500,000.00 September (actual) P4,500,000.00 P2,000,000.00 October (forecast) P1,000,000.00 P500,000.00 November (forecast) P1,500,000.00 P750,000.00 December (forecast) P2,000,000.00 P1,000,000.00 (a) Total cash receipt for the month of December is P1,850,000. (b) The firm pays cash for 40 percent of its purchases. (C) The firm pays for 60 percent of its purchases the following month. (d) Salaries and wages amount to 15 percent of the preceding month's sales. (e) Sales commissions amount to 2 percent of the preceding month's sales. (f) Rental payments of P100,000 must be made each month. (g) A principal and interest payment on an outstanding loan is due in December of P150,000. (h) The firm pays dividends of P50,000 at the end of the quarter. () Fixed assets costing P600,000 will be purchased in December. ) Depreciation expense each month of P45,000. How much is the net cash flows in December? A P390,000 B (P155,000) (c) (P430,000) D P135,000

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter4: Financial Planning And Forecasting

Section: Chapter Questions

Problem 4P

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