The January 31, 2006 balance sheet of a company follows:

Assets:
Cash $12,000
Accounts Receivable (net of
Allowance for Uncollectibles
Of $1,440) = $34,560
Inventory $52,400
Plant Assets (net of accum depre of $1,440) = $36,000
Total Assets = $134,960

Liabilities and Stockholders Equity:
Accounts Payable: $70,200
Common Stock: $25,000
Retained Earnings: $39,760
Total Liabilities and Stockholders Equity: $134,960


Additional information about the company follows:
• Expected sales for February and March are $120,000 and $130,000, respectively.
• The collection pattern from the month of sale forward is 50%, 48%, and 2% uncollectible.
• Cost of Goods Sold is 65% of sales.
• Purchases each month are 60% of the current month’s sales and 30% of the next month’s projected sales. All purchases are paid for in the month following purchase.
• Selling and administrative expenses each month are $21,500, of which $4,000 is depreciation.

a. What are the budgeted cash collections for February 2006?
b. What will be the Inventory account balance at February 28, 2006?
c. What will be the projected balance in the Retained Earnings account at February 28, 2006?
d. If the company wishes to maintain a minimum cash balance of $8,000, how much will be available for investment or need to be borrowed at the end of February 2006?

morgaine300

There are a couple of issues here. One is that this is a very long problem that I could sit down and work with someone on for like an hour in person. It's just way too much for a forum like this. Also, I'm certainly not going to just go through and work all this out for you and give an answer. I'm here to help people learn, not do their homework for them.

You need to narrow this down somehow. And do you have any of it done? If so, post what you have and it can be checked.