Bracken Corporation is a small wholesaler of gourmet food
products. Data regarding the store's operations follow:
o Sales are budgeted at $462,000 for November, $348,000 for
December, and $380,000 for January.
o Collections are expected to be 80% in the month of sale, 17% in
the month following the sale, and 3% uncollectible.
o The cost of goods sold is 85% of sales.
o The company would like to maintain ending merchandise inventories
equal to 70% of the next month's cost of goods sold. Payment for
merchandise is made in the month following the purchase.
o Other monthly expenses to be paid in cash are $26,550.
o Monthly depreciation is $20,400.
o Ignore taxes.
Balance Sheet October 31 | |
Assets | |
Cash | $29,000 |
Accounts receivable, net of allowance for uncollectible accounts | 82,400 |
Merchandise inventory | 217,500 |
Property, plant and equipment, net of $656,000 accumulated depreciation | 1,312,000 |
Total assets | 1,640,900 |
Liabilities and Stockholders' Equity | |
Accounts payable | $300,000 |
Common stock | 840,000 |
Retained earnings | 500,900 |
Total liabilities and stockholders' equity | $1,640,900 |
The cost of December merchandise purchases would be:
$314,840
$226,100
$295,800
$392,700
question 2)
Rhett Corporation manufactures and sells dress shirts. Each
shirt (unit) requires 5 yards of cloth. Selected data from Rhett's
master budget for next quarter are shown below:
April | May | June | |
Budgeted sales (in units) | 28,100 | 29,100 | 41,300 |
Budgeted production (in units) | 35,700 | 38,400 | 37,300 |
Desired ending inventory of cloth (in yards) | 3,570 | 3,500 | 2,760 |
How many yards of cloth should Rhett plan on purchasing in May?
191,930 yards
179,930 yards
195,570 yards
195,500 yards
1) December purchase = Cost of goods sold+Ending inventory-Beginning inventory
= (348000*85%)+(380000*85%*70%)-(348000*85%*70%)
December purchase = 314840
So answer is a) $314840
2) Purchase in May = (38400*5)+3500-3570 = 191930
So answer is a) 191930 Yards
Bracken Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow:...
Bracken Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: o Sales are budgeted at $462,000 for November, $348,000 for December, and $380,000 for January. o Collections are expected to be 80% in the month of sale, 17% in the month following the sale, and 3% uncollectible. o The cost of goods sold is 85% of sales. o The company would like to maintain ending merchandise inventories equal to 70% of the next month's...
Bracken Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: • Sales are budgeted at $380,000 for November, $400,000 for December, and $400,000 for January • Collections are expected to be 80% In the month of sale, 19% In the month following the sale, and 1% uncollectible. • The cost of goods sold Is 75% of sales. • The company would like to maintain ending merchandise Inventories equal to 65% of the next month's...
Bracken Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: • Sales are budgeted at $250,000 for November, $260,000 for December, and $260,000 for January. • Collections are expected to be 75% in the month of sale, 24% in the month following the sale, and 1% uncollectible. • The cost of goods sold is 80% of sales. • The company would like to maintain ending merchandise inventories equal to 70% of the next...
Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow. • Sales are budgeted at $290,000 for November, $270,000 for December, and $260,000 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 would like to maintain ending merchandise inventories equal to 65% of the next month's cost of goods...
Brarin Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: • Sales are budgeted at $440,000 for November, $460,000 for December, and $460,000 for January. • Collections are expected to be 85% in the month of sale, 14% in the month following the sale, and 1% uncollectible. • The cost of goods sold is 80% of sales. • The company would like to maintain ending merchandise inventories equal to 70% of the next...
Brarin Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: • Sales are budgeted at $450,000 for November, $470,000 for December, and $470,000 for January. • Collections are expected to be 80% in the month of sale, 18% in the month following the sale, and 2% uncollectible. • The cost of goods sold is 75% of sales. • The company would like to maintain ending merchandise inventories equal to 65% of the next...
Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow • Sales are budgeted at $320,000 for November, $300,000 for December, and $290,000 for January • Collections are expected to be 55% in the month of sale and 45% in the month following the sale. • The cost of goods sold is 70% of sales. • The company would like to maintain ending merchandise inventories equal to 70% of the next month's cost of...
Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow • Sales are budgeted at $450,000 for November, $430,000 for December, and $420,000 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 would like to maintain ending merchandise inventories equal to 65% of the next month's cost of goods...
Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: Sales are budgeted at $440,000 for November, $420,000 for December, and $410,000 for January. Collections are expected to be 65% in the month of sale and 35% in the month following the sale. The cost of goods sold is 80% of sales. The company would like to maintain ending merchandise inventories equal to 70% of the next month's cost of goods sold. Payment for...
Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow: Sales are budgeted at $350,000 for November, $330,000 for December, and $320,000 for January. Collections are expected to be 45% in the month of sale and 55% in the month following the sale. The cost of goods sold is 75% of sales. The company would like to maintain ending merchandise inventories equal to 80% of the next month's cost of goods sold. Payment for...