Figure 8-6 the Records of Morgantown, Inc

question 134

Multiple Choice

Figure 8-6 The records of Morgantown, Inc.show the following forecasted sales:
Collection pattern:
60 percent in month of sale
40 percent in month following the sale
The company has a selling price of $10 per unit and expects to maintain ending inventories equal to 20 percent of next month's sales.
Refer to Figure 8-6. How many dollars are expected to be collected in October?

• A) $420,000
• B) $460,000
• C) $240,000
• D) $510,000

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Definitions:

Reduce Its Value

An action or event that decreases the worth of something, affecting its marketability or usefulness.

Future Interest

An interest in real or personal property that will begin at a future date through a legal arrangement, such as a will or trust.

Earnest Money

A deposit made by a buyer to demonstrate commitment to a purchase agreement, often used in real estate transactions.

Serious Offer

An offer made in earnest, usually in a contractual context, implying a genuine intent to enter into an agreement.