Asked by zaimel moses on Jul 12, 2024
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Jumbotron Inc. had sales of $8,000 in November, $14,000 in December, and projects sales of $10,000 for January, $12,000 for February, and $8,000 for March. The firm's cost of goods sold every month is equal to 70% of the next month's sales. The firm collects its receivables in 60 days and pays its payables in 30 days. The firm begins January 1 with $10,000 in cash. All sales and purchases are on credit. What are Jumbotron's total cash disbursements in March?
A) $4,200
B) $5,600
C) $7,100
D) $8,300
E) $9,800
Cash Disbursements
Payments made by a business in cash, including expenses, debt payments, and distributions to shareholders.
Cost of Goods Sold
Represents the direct costs attributable to the production of the goods sold in a company, including the cost of the materials and labor directly used to create the product.
Receivables
Debts that customers have towards a firm for items or services that have been received or employed, yet remain unpaid.
- Understand the mechanics of managing cash flow, encompassing the cash received from sales and the cash spent on expenses.
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Learning Objectives
- Understand the mechanics of managing cash flow, encompassing the cash received from sales and the cash spent on expenses.
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