Express Company has budgeted sales for the first quarter of next year as follows: January $240,000 February $280,000 March $320,000. Sales are 70% credit and 30% cash. Credit sales are collected 80% in the month following sales and 20% in the second month following the sale. Cost of Goods is 65% of sales. Express Company desires an ending inventory equal to 60% of the next month's cost of goods sold. Purchases are paid for 25% in the month of purchase and 75% in the following month. A) What are the total cash collections in March? B) What is the budgeted March 31 Accounts Receivable? C) Prepare a purchases budget for February. D) How much will cash disbursements for purchases be in February? E) What is the budgeted February 28 Accounts Payable? F) What is the budgeted February 28 Inventory?
Excel file contains cash budget.