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Two pounds of material are required for each finished unit. The inventory of materials at the end of each month should equal 20% of the following month's production needs. Purchases of raw materials for May should be: a. 40,000 pounds b. 42,000 pounds c. 43,000 pounds d. 44,400 pounds e. None of the above. The answer is 7. The Khaki Corporation has the following budgeted sales data: The regular pattern of collection of credit sales is 30% in the month of sale, 60% in the month following sale, and the remainder in the second month following the month of sale. There are no bad debts. The budgeted accounts receivable balance on February 28 would be: a. $350,000 c. $360,000 b. $355,000 d. $365,000 e. None of the above. The answer is Questions \#8, 9 and 10 Refer to the following data [Hint: Much more information than is needed] Bracken Corporation is a small wholesaler of gourmet food products. Liabilities and Stockholders' Equity Accounts Payable... Common Stock $255,000 Retained Earnings 840,000 352,250 $1,447,250 Data regarding the store's operations follows: * Sales are budgeted at $330,000 for November, $350,000 for December, and $400,000 for January. * Collections are expected to be 80% in the month of sale, 19% in the month following sale, and 1% uncollectible. * The Cost of Goods Sold is 60% of sales. * The company would like to maintain ending inventory equal to 70% of the next month's Cost of Goods Sold. Payment for merchandise is made in the month following purchase. * Other monthly expenses to be paid in cash are $21,800. * Monthly Depreciation is $19,000. * Ignore Taxes. 8. Expected cash collections in December are: a. $334,000 c. $252,400 b. 342,700 d. 400,000 e. None of the above. The answer is 9. The cost of December merchandise purchases would be: a. $196,000 c. $228,000 b. $231,000 d. $236,800 e. None of the above. The answer is 10. December cash disbursements for merchandise purchases would be: a. $202,400 c. $209,200 b. $206,400 d. $212,200 e. None of the above. The answer is

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