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The following information pertains to Fiza Cosmetics:
Month Sales Purchases
July $15,000 $5,000
August 17,000 6,000
September 19,000 7,000
October 21,000 8,000
November 24,000 9,000
December 30,000 10,000
Cash is collected from customers in the following manner:
Month of sale 40%
Month following sale 50%
Two months following sale 10%
50% of purchases are paid for in cash in the month of purchase, and the 50% balance is paid the following month.
Required:
Question a. prepare a summary of cash collections for September and October.
Question b. prepare a summary of cash disbursements for September and October.
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