The Following Information for the Second Quarter of 2011 Pertains

question 124

Multiple Choice

The following information for the second quarter of 2011 pertains to Huffington Company:

•Cash is collected from customers in the following manner:

•40% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month.
•Labor costs are 20% of sales. Other operating costs are $45,000 per month (including $12,000 of depreciation) . Both of these are paid in the month incurred.
•The cash balance on June 1 is $6,000. A minimum cash balance of $4,500 is required at the end of the month. Money can be borrowed in multiples of $3,000.
•No loans outstanding on June 1.
-How much cash will be disbursed for labor and operating costs in June?

• A)$63,000
• B)$70,000
• C)$88,400
• D) $96,400

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Definitions:

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Actions or tasks carried out with uniformity and reliability over a period, ensuring stability and predictability in outcomes.

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Refers to individuals or departments within an organization that rely on the support or services of another unit to fulfill their job duties.

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