[jaytleo]

The following data relate to the operations of Shilow Company, a wholesale distributor of comsumer goods:
Current Assists as of March 31
Cash 8,000
A.R 20,000
Inventory 36,000
Building and equipment, net 120,000
Accounts Payable 21,750
Capital Stock 150,000
Retained earnings 12,250

a. the gross margin is 25% of sales
b. Actual and budgeted sales data:
March (actual) 50,000
April 60,000
May 72,000
June 90,000
July 48,000

c. Sales are 60% for cash and 40% for credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales.

d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold.

e. One-half of a month's inventory purchases is paid for in the month of purchase; the other half is paid for in the following month. The accounts payable at March 31 are the reuslt of March purchases of inventory.

f. Monthly expenses are as follows: commissions, 12% of sales; rent, $2,500 per month: other expenes (excluding depreciation), 6% of sales. Assume that these expenes are paid monthly. Depreciation is $900 per month (includes depreciation on new assets)

g. W

[haider78605]

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