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sam3359 sam3359
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A year ago

KAB Incorporated, a small retail store, had the following results for May. The budgets for June and July are also given.

May (actual)June (budget)July (budget)
Sales$ 42,000$ 40,000$ 45,000
Less cost of goods sold21,00020,00022,500
Gross margin21,00020,00022,500
Less selling and administrative expenses20,00020,00020,000
Net operating income$ 1,000$ 0$ 2,500

Sales are collected 80% in the month of the sale and the balance in the month following the sale. (There are no bad debts.) The goods that are sold are purchased in the month prior to sale. Suppliers of the goods are paid in the month following the sale. The "selling and administrative expenses" are paid in the month of the sale.

The amount of cash collected during June should be:



▸ $32,000

▸ $40,000

▸ $40,400

▸ $41,000
Textbook 
Introduction to Managerial Accounting: Brewer Edition: 9e

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
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9quatroquatro99quatroquatro9
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sam3359 Author
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A year ago
This helped my grade so much Perfect
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Helped a lot
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