Question

Coronado Industries reported the following information for 2016: October November December Budgeted sales $470000 $420000 $510000 Budgeted purchases $290000 $226000 $268000 All sales are on credit. Customer amounts on account are collected 50% in the month of sale and 50% in the following month. Cost of goods sold is 35% of sales. Coronado purchases and pays for merchandise 60% in the month of acquisition and 40% in the following month. Accounts payable is used only for inventory acquisitions. How much cash will Coronado receive during November?

Answer 1

Answer: $445000

Step-by-step explanation:

Based on the information that has been provided in the question, the amount of cash that Coronado will receive during the month of November will be:

= October sales × 50% + Novemeber sales × 50%

= ($470000 × 50%) + (420000 × 50%)

= $235000 + $210000

= $445000