The following information pertains to Amigo Corporation:
Month Sales then Purchases
July $30,000, $10,000
August 34,000, 12,000
September 38,000, 14,000
October 42,000, 16,000
November 48,000, 18,000
December 60,000, 20,000
• Cash is collected from customers in the following manner:
Month of sale (2% cash discount) 30%
Month following sale 50%
Two months following sale 15%
Amount uncollectible 5%
• 40% of purchases are paid for in cash in the month of purchase, and the balance is paid the
a. Prepare a summary of cash collections for the 4th quarter.
b. Prepare a summary of cash disbursements for the 4th quarter.