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Handy Hardware is a retall hardware store. Information about the store's operations follows. 15 points...

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Question

Accounting

Handy Hardware is a retall hardware store. Information about the store's operations follows.
15
points
01:49:28
References
November 201 sales amounted to $490,000.
Sales are budgeted at $530,000 for December 201 and $490,000 for January 202.
Collections are expected to be 70 percent in the month of sale and 28 percent in the month following the sale. Two percent of sales are expected to be uncollectible. Bad debts expense is recognized monthly.
The store's gross margin is 20 percent of its sales revenue.
A total of 70 percent of the merchandise for resale is purchased in the month prior to the month of sale, and 30 percent is purchased in the month of sale. Payment for merchandise is made in the month following the purchase.
Other monthly expenses pald in cash amount to $46,100.
Annual depreciation is $459,000.
The company's balance sheet as of November 30,201, Is as follows:
HANDY HARDWARE, INC.
Balance Sheet
November 30,201
Assets
Required:
Compute the budgeted cash collections for December 201.
Compute the budgeted Income (loss) before Income taxes for December 20x1.
Compute the projected balance in accounts payable on December 31,20x1.
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