Prepare a monthly schedule of cash receipts sales in


Bombs Away Video Games Corporation has forecasted the following monthly sales: January $ 116,000 July $ 61,000 February 109,000 August 61,000 March 41,000 September 71,000 April 41,000 October 101,000 May 36,000 November 121,000 June 51,000 December 139,000 Total annual sales = $948,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to annual sales (in units) divided by 12. Of each month's sales, 40 percent are for cash and 60 percent are on account. All accounts receivable are collected in the month after the sale is made. a. Construct a monthly production and inventory schedule in units. Beginning inventory in January is 41,000 units. b. Prepare a monthly schedule of cash receipts. Sales in December before the planning year are $100,000. c. Prepare a cash payments schedule for January through December. The production costs of $2 per unit are paid for in the month in which they occur. Other cash payments, besides those for production costs, are $61,000 per month. d. Prepare a monthly cash budget for January through December using the cash receipts schedule from part b and the cash payments schedule from part c. The beginning cash balance is $5,000, which is also the minimum desired. (Negative amounts should be indicated by a minus sign.)

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Prepare a monthly schedule of cash receipts sales in
Reference No:- TGS02617988

Expected delivery within 24 Hours