Prepare a merchandise purchases budget

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Reference no: EM13510218

Capp Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow:

%u2022

Sales are budgeted at $460,000 for November, $470,000 for December, and $450,000 for January.

%u2022

Collections are expected to be 55% in the month of sale, 42% in the month following the sale, and 3% uncollectible.

%u2022 The cost of goods sold is 60% of sales.
%u2022

The company desires an ending merchandise inventory equal to 35% of the following month's cost of goods sold. Payment for merchandise is made in the month following the purchase.

%u2022 The November beginning balance in the accounts receivable account is $81,000.
%u2022 The November beginning balance in the accounts payable account is $268,000.

 

Required:

Prepare a Schedule of Expected Cash Collections for November and December. (Omit the "$" sign in your response.)

Capp Corporation
Schedule of Expected Cash Collections

November December
Sales $ $
Schedule of Expected Cash Collections

Accounts receivable $
November sales
$
December sales




Total cash collections $ $






Prepare a Merchandise Purchases Budget for November and December. (Input all amounts as positive values. Omit the "$" sign in your response.)

Capp Corporation
Merchandise Purchases Budget

November December
Budgeted cost of goods sold $ $
(Click to select) Deduct Add : (Click to select) Beginning merchandise inventory Desired ending merchandising inventory




Total needs

(Click to select) Add Deduct : (Click to select) Beginning merchandise inventory Desired ending merchandising inventory




Required purchase $

 

Reference no: EM13510218

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