Walter enterprises expects its september sales to be 20% higher than its august sales of $150,000. purchases were $100,000 in august and are expected to be $120,000 in september. all sales are on credit and are collected as follows: 30% in the month of the sale and 70% in the following month. merchandise purchases are paid as follows: 25% in the month of purchase and 75% in the following month. the beginning cash balance on september 1 is $7,500. the ending cash balance on september 30 would be:
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Ответ:
The ending balance for September month is $61,500
Explanation:
For computing the ending balance, the following equation should be used which is shown below:
= Beginning cash balance + cash receipts - cash payments
where,
Beginning cash balance = $7,500
Cash receipts :
30% of September sale, where September sale is equals to
= august sale × 120 %
= $150,000 × 120%
= $180,000
So,
30% of September sale = $180,000 × 30% = $54,000
70% of august sale
= $150,000 × 70%
= $105,000
So, the September cash receipts is equals to
70% of august sale + 30 % of September sale
= $105,000 + $54,000
= $159,000
Cash payments:
25 % of September purchase
= $120,000 × 25%
= $30,000
75% of august purchase
= 75% × $100,000
= $75,000
So, the cash payment of September is equals to
= 25% of September purchase + 75 % of august purchase
= $30,000 + $75,000
=$105,000
Now put these values on the above equation
So, the ending balance would be
= $7,500 + $159,000 - $105,000
= $61,500
Hence, the ending balance for September month is $61,500
Ответ: