Reference no: EM133093167
Question - Byron Wholesale Company developed the following data for the preparation of January 2022 budget:
Total expected sales in January: $160,000 of which 25% is cash sales and the balance on account.
Actual credit sales for the previous months are: December $80,000, November $60,000; and October $70,000.
Cash balance January 1, 2022: $12,000
Credit sales are collected as follows: 30 percent in the month of sale, 60 percent in the following month, and 10 percent in the second month following the sale.
Expected purchases for goods for sale for January 2022 are $60,000. Actual December purchases were $45,000 and for November were $30,000. 15% of the purchases are paid in the month of purchase 60% in the following month and the remainder in the second month after purchase.
January 2022 expected other expenses are Salaries $42,000, utilities $1,490, selling and administrative expenses $49,000 of which depreciation on the building is $4,000. Payments for other exenses are made on cash.
Required -
A) Calculate the anticipated cash receipts from sales in January 2022.
B) Calculate the anticipated total cash available in January 2022.
C) Calculate the January 2022 cash payments for purchases.
D) Calculate the anticipated cash balance on January 31, 2022.
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