NewGen Computers Is Preparing Its Budget for 2011

question 109

Multiple Choice

NewGen Computers is preparing its budget for 2011. Sales for the year are budgeted at $1,000,000; 20% are cash sales and 80% are credit sales. The company expects to collect 60% of all credit sales in 2011. Budgeted expenses are $800,000. These expenditures include $25,000 for depreciation and $497,000 for variable manufacturing overhead. Given this information, total cash inflows from sales for 2011 would be:

• A) $800,000
• B) $680,000
• C) $480,000
• D) $455,000

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Definitions:

Organizational Systems

The structured arrangement of parts, people, and processes within an organization that work together to achieve its goals.

Inputs

Resources, information, or effort that is put into a system or process to achieve an output or a result.

Technology Component

Elements or parts of a technological system, such as hardware, software, and network resources, that are essential for its functioning.

Throughputs

The amount of material or items passing through a system or process within a given period.