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    Average cash gain or loss

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    XYZ Corporation's budgeted monthly sales are $4,500. Forty percent of its customers pay in the first month and
    take the 1 percent discount. The remaining 60 percent pay in the month following the sale and don't receive a
    discount. XYZâ??s bad debts are very small and are excluded from this analysis. Purchases for next month's sales
    are constant each month at $1,200. Other payments for wages, rent, and taxes are constant at $800 per month.
    Construct a single month's cash budget with the information given. What is the average cash gain or (loss) during a typical month for XYZ Corporation?

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    Solution Preview

    Cash budget lists the cash inflows and cash outflows and the change in cash. For a single month the cash budget ...

    Solution Summary

    The solution explains how to prepare a cash budget to determine the average cash gain or loss in a month

    $2.19

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