The Dancer Company Expects to Have Sales of R30,000 in January

question 44

Multiple Choice

The Dancer Company expects to have sales of R30,000 in January, R33,000 in February, and R38,000 in March.If 20 percent of sales are for cash, 40 percent are credit sales paid in the month following the sale, and 40 percent are credit sales paid 2 months following the sale, what are the cash receipts from sales in March?

• A) R55,000
• B) R47,400
• C) R38,000
• D) R32,800
• E) R30,000

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Definitions:

Reported Product Costs

Costs associated with the production of goods that are documented and presented in financial statements, including materials, labor, and overhead expenses.

Overhead Rates

The ratio used to allocate manufacturing overhead costs to units produced or services provided, based on a specific formula or allocation base.

Setup Labour

The work and time involved in preparing equipment or machines for a new production run, often considered a manufacturing overhead cost.

Setup For One Run

The preparation and adjustment activities required to switch a production process or machine from making one product or batch to another.