The administrative department consists of the president and an office staff of eight who handle the secretarial, purchasing, and accounting duties.( Total of nine people.) The following information is available regarding the 2005 actual costs:
It is felt that the level of the office and administrative staff will be adequate for the coming year. It is expected that the following changes will occur in 2006:
2006 INCOME TAX INFORMATION
The current federal and state income tax rates total 40 %. All taxes for the year will be paid by the end of the year which means that there will be no accrued taxes on December 31, 2006.
2006 ACCOUNTS RECEIVABLE INFORMATION
It is expected sales will occur evenly throughout the year and that there will be no cash sales. 75 % of monthly sales will be collected in the month following the sale, and the remaining 25 % will be collected by the end of the second month. No bad debts are anticipated.
2006 ACCOUNTS PAYABLE INFORMATION