Toyota & Sons is a family-owned auto-parts store. You are the management accountant of the concern and have been given the task of preparing the cash budget for the business for the quarter ending March 31, 2024. Your data collection has yielded the following: (1) Extracts from the sales and purchases budgets are as follows: Month Sales On Account (II) November 2023-March 2024 November December January February March Cash Sales $151,100 $480,000 $375,000 $145,500 $600,000 $360,000 $159,025 $700,000 $508,000 $169,350 $650,000 $400,000 $176,200 $800,000 $521,000 Purchases An analysis of the records shows that trade receivables (accounts receivable) are settled according to the following credit pattern, in accordance with the credit terms 2/30, n90: 45% in the month of sale 30% in the first month following the sale. 25% in the second month following the sale. Expected purchases include cash purchases of $28,000 in January and $21, 000 in March. All other purchases are on account. Accounts payable are settled as follows, in accordance with the credit terms 4/30, n60: 75% in the month in which the inventory is purchased. 25% in the following month

Toyota & Sons is a family-owned auto-parts store. You are the management accountant of the concern and have been given the task of preparing the cash budget for the business for the quarter ending March 31, 2024. Your data collection has yielded the following: (1) Extracts from the sales and purchases budgets are as follows: Month Sales On Account (II) November 2023-March 2024 November December January February March Cash Sales $151,100 $480,000 $375,000 $145,500 $600,000 $360,000 $159,025 $700,000 $508,000 $169,350 $650,000 $400,000 $176,200 $800,000 $521,000 Purchases An analysis of the records shows that trade receivables (accounts receivable) are settled according to the following credit pattern, in accordance with the credit terms 2/30, n90: 45% in the month of sale 30% in the first month following the sale. 25% in the second month following the sale. Expected purchases include cash purchases of $28,000 in January and $21, 000 in March. All other purchases are on account. Accounts payable are settled as follows, in accordance with the credit terms 4/30, n60: 75% in the month in which the inventory is purchased. 25% in the following month

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter4: Financial Planning And Forecasting

Section: Chapter Questions

Problem 5P

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