Budgeted sales for January $200,000 and February $100,000. Collections for sales are 60% in the month of sale and 40% the next month. Gross margin is 30% of sales. Administrative costs are $10,000 each month. Beginning accounts receivable is $20,000. Beginning inventory is $14,000. Beginning accounts payable is $65,000. (All from inventory purchases.) Purchases are paid in full the following month. information pertains to the January operating budget for an company. Desired ending inventory is 20% of next month's cost of goods sold (COGS). A)For January, budgeted cash collections are ________. B) At the end of January, budgeted accounts receivable is ________.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Budgeted sales for January $200,000 and February $100,000.
Collections for sales are 60% in the month of sale and 40% the next month.
Gross margin is 30% of sales.
Administrative costs are $10,000 each month.
Beginning accounts receivable is $20,000.
Beginning inventory is $14,000.
Beginning accounts payable is $65,000. (All from inventory purchases.)
Purchases are paid in full the following month.
information pertains to the January operating budget for an company.
Desired ending inventory is 20% of next month's cost of goods sold (COGS).
- A)For January, budgeted cash collections are ________.
- B) At the end of January, budgeted accounts receivable is ________.
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