Best writers. Best papers. Let professionals take care of your academic papers

Order a similar paper and get 15% discount on your first order with us
Use the following coupon "FIRST15"
ORDER NOW

Below is summary monthly income statement data for Ace Manufacturing Company. January February Sales revenue 275,000 250,000 Direct materials purchases 60,000 70,000

/in /by

Below is summary monthly income statement data for Ace Manufacturing Company.

    January   February 

Sales revenue   275,000  250,000

Direct materials purchases   60,000  70,000

Direct labor   88,000  95,000

Manufacturing overhead   60,000  62,000

Selling and administrative expenses   45,000  46,000

All sales are on account, and history has shown that 40% of sales is expected to be collected in the month of the sale, with 60% collected the following month.

Direct materials are paid 50% in the month of purchase and 50% the following month. All other expenses are paid as incurred. All costs shown are cash-based costs (depreciation has already been eliminated).

Other data:

1. December sales were $240,000.

2. Purchases of direct materials purchased in December were $50,000.

3. The company has interest payments due of $5,000 per month.

4. The cash balance on January 1 was $15,000.

Instructions

A. Prepare schedules for expected collections from customers and expected payments for direct materials purchases.

B. Prepare a cash budget for January and February.

 
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"