Questions -

Q1. Oakton Furniture provided the following information relevant to its sales for December 2013 and the first quarter of 2014

Based on the company's collection history, 2% of credit sales are uncollectible, 40% are collected in month of sale and the remainder is collected in the following month. Total budgeted cash receipts in February 2014 are expected to be:

$60,000.

$346,400.

$162,400.

$228,000.

Q2. Browning Company's sales budget shows the following expected total sales:

Month - Sales

January $20,000

February $35,000

March $40,000

April $45,000

The company expects 70% of its sales to be on account (credit sales). Credit sales are collected as follows: 25% in the month of sale, 69% in the month following the sale with the remainder being uncollectible and written off. The total cash inflows from sales in April would be:

$30,725.

$28,200.

$40,695.

$23,625.

Q3. Chu Company provided the following information related to its inventory sales and purchases for December 2013 and the first quarter of 2014:

Desired ending inventory levels are 25% of the following month's projected cost of goods sold. Budgeted purchases of inventory in February 2014 would be:

$165,000.

$225,000.

$135,000.

$180,000.