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    Dilbert Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:

    - Sales are budgeted at $260,000 for November, $230,000 for December, and $210,000 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 65% of sales.
    - The company purchases 60% of its merchandise in the month prior to the month of sale and 40% in the month of sale. Payment for merchandise is made in the month following the purchase.
    - Other monthly expenses to be paid in cash are $20,300.
    - Monthly depreciation is $20,000.
    - Ignore taxes.

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    Solution Preview

    46. Expected cash collections in December are:
    A) $230,000
    B) $184,000
    C) $233,400
    D) $49,400

    47. The cost of ...

    Solution Summary

    This solution gives calculations for expected cash, cost of purchases, cash disbursements, and excess (deficiency) of cash.