The Following Information Pertains to the January Operating Budget for Casey

question 184

Multiple Choice

The following information pertains to the January operating budget for Casey Corporation.
-Budgeted sales for January $203,000 and February $101,000.
-Collections for sales are 60% in the month of sale and 40% the next month.
-Gross margin is 25% of sales.
-Administrative costs are $20,000 each month.
-Beginning accounts receivable is $28,000.
-Beginning inventory is $19,000.
-Beginning accounts payable is $75,000. (All from inventory purchases.)
-Purchases are paid in full the following month.
-Desired ending inventory is 20% of next month's cost of goods sold (COGS) .
For January, budgeted net income is ________.

• A) $50,750
• B) $30,750
• C) $101,800
• D) $61,200

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Definitions:

Family

A social unit consisting of individuals related by blood, marriage, or adoption, often forming a household.

Poverty Rate

The percentage of the population with incomes below the official poverty line established by the federal government.

Children Under 18

Individuals who are legally considered minors and are below the age of 18 years old, often subject to specific legal protections and restrictions.

White Males

A demographic group defined by race (white) and gender (male), often discussed in contexts of social, economic, or political analysis.