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September

October

November

December

$40,000$

$50,000$

$80,000$

$60,000$

IV$.$ Barbie Distributors wants a projection of cash receipts and cash payments for the month of November. On November $28,$ a note will be payable in the amount of $ $12,000,$ including interest. The cash balance on November $1$ is $ $27,000.$ Accountable to merchandise creditors at the end of October were $ $206,000.$ The company's experience indicates that $75$ percent of sales will be collected during the month of sale, $25$ percent in the month following the sales. The company sells various products at an average price of $ $10$ per unit. Selected sale figures are as follows:

Sales Units

Because purchases are payable within $15$ days approximately $50$ percent of the purchases in a given month are paid in the following month. The average cost of units purchased is $ $6$ per unit. Inventories at the end of each month are maintained at a level of $2,000$ units plus $20$ percent of the number of units that will be sold in the following month. The inventory on October $1$ amounted to $9,000$ units. Budgeted operating expenses for November are $$250,000.$ Of this amount, $ $50,000$ is considered depreciation expenses. All operating expenses, other than depreciation are paid in the month in which they are incurred. The company expects to sell fully depreciated equipment in November for $ $1,000$ cash.

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