AB 209 STUDY Great Stories /ab209study.com AB 209 STUDY Great Stories /ab209study.com | Page 16
Assume monthly sales are $ 280,000 October, $ 290,000 November, and $ 345,000
December
Assume Inventory purchases are $ 60,000 Oct, $ 60,000 Nov, and $ 70,000
Dec
Assume the owner gets a cash disbursement in Oct of 45,000, Nov of 51,000, and
Dec of 52,000 Assume wages and salaries are 48 % of gross monthly sales Assume rent is $ 9500 a month Assume utilities are 5 % of gross monthly Assume a tax prepayment of $ 16,000 in October Assume bank interest on the note is $ 15000 / month Assume a depreciation expense of $ 15,000 in December
Answer the questions: Does the firm need to borrow money at the end of the year to meet expenses?
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Assume monthly sales are $ 280,000 October, $ 290,000 November, and $ 345,000
December
Assume Inventory purchases are $ 60,000 Oct, $ 60,000 Nov, and $ 70,000
Dec
Assume the owner gets a cash disbursement in Oct of 45,000, Nov of 51,000, and
Dec of 52,000 Assume wages and salaries are 48 % of gross monthly sales Assume rent is $ 9500 a month Assume utilities are 5 % of gross monthly Assume a tax prepayment of $ 16,000 in October Assume bank interest on the note is $ 15000 / month Assume a depreciation expense of $ 15,000 in December
Answer the questions: Does the firm need to borrow money at the end of the year to meet expenses?