Answered

Discover a wealth of knowledge at Westonci.ca, where experts provide answers to your most pressing questions. Our Q&A platform offers a seamless experience for finding reliable answers from experts in various disciplines. Discover detailed answers to your questions from a wide network of experts on our comprehensive Q&A platform.

Item 6 Worton Distributing expects its September sales to be 20% higher than its August sales of $168,000. Purchases were $118,000 in August and are expected to be $138,000 in September. All sales are on credit and are expected to be collected as follows: 40% in the month of the sale and 60% in the following month. Purchases are paid 20% in the month of purchase and 80% in the following month. The cash balance on September 1 is $28,000. The ending cash balance on September 30 is estimated to be:

Sagot :

anthougo

Answer:

Worton Distributing

he ending cash balance on September 30 is estimated to be:

= $87,440

Explanation:

a) Data and Calculations;

                                August        September

Sales                    $168,000       $201,600 ($168,000 * 1.2)

Purchases            $118,000         $138,000

Cash balance September 1         $28,000

Collection of sales on credit:  August     September

Sales                                     $168,000      $201,600

40% month of sale                  67,200          80,640

60% month following                                  100,800

Total cash collections                                $181,440

Payment for purchases:      August        September

Purchases                          $118,000         $138,000

Payment:

20% month of purchase     23,600             27,600

80% month following                                   94,400

Total payment for purchases                  $122,000

Cash budget for September

Beginning balance $28,000

Cash collections       181,440

Available cash      $209,440

Cash payments      122,000

Ending balance      $87,440

Thank you for your visit. We are dedicated to helping you find the information you need, whenever you need it. We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. Thank you for choosing Westonci.ca as your information source. We look forward to your next visit.