Prepare a schedule of expected cash collections for

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Reference no: EM13569007

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

•	Sales are budgeted at $250,000 for November, $260,000 for December, and $240,000 for January.
•	Collections are expected to be 40% in the month of sale, 58% in the month following the sale, and 2% uncollectible.
•	The cost of goods sold is 70% of sales.
•	The company desires an ending merchandise inventory equal to 20% of the following month's cost of goods sold. Payment for merchandise is made in the month following the purchase.
•	The November beginning balance in the accounts receivable account is $60,000.
•	The November beginning balance in the accounts payable account is $247,000.

Required:

a.	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	$	$

b.	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)DeductAdd: (Click to select)Desired ending merchandising inventoryBeginning merchandise inventory

Total needs
(Click to select)DeductAdd: (Click to select)Beginning merchandise inventoryDesired ending merchandising inventory

Required purchase	$	$

Reference no: EM13569007

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