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

Sales are budgeted at $320,000 for November, $330,000 for December, and $310,000 for January.

Collections are expected to be 40% in the month of sale and 60% in the month following the sale.

The cost of goods sold is 75% of sales.

The company desires an ending merchandise inventory equal to 20% of the cost of goods sold in the following month.

Payment for merchandise is made in the month following the purchase.

The November beginning balance in the accounts receivable account is $67,000.

The November beginning balance in the accounts payable account is $254,000.

Prepare a Schedule of Expected Cash Collections for November and December.

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Business

Carter Hall

22 November, 13:59

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

Sales are budgeted at $320,000 for November, $330,000 for December, and $310,000 for January.

Collections are expected to be 40% in the month of sale and 60% in the month following the sale.

The cost of goods sold is 75% of sales.

The company desires an ending merchandise inventory equal to 20% of the cost of goods sold in the following month.

Payment for merchandise is made in the month following the purchase.

The November beginning balance in the accounts receivable account is $67,000.

The November beginning balance in the accounts payable account is $254,000.

Prepare a Schedule of Expected Cash Collections for November and December.

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Lailah Powers · Answer 1

Schedule of expected cash collection is a form of budgeted that list the time frames and the amount of payment expected from customers for the purpose of efficient planning.

Account receivables

60% * October sales = 67,000

November sales

40% * 320000 (November sales) = $128,000

$195000

December cash collection

60%*320000 (November sales) = 192000

40%*330000 (December sales) = $132000

$324,000