Agua Cool is a distributor of bottled water. For each of the items, compute the amount of
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a. Management expects to sell equipment that cost $14,000 at a gain of $7,000. Accumulated depreciation on this equipment is $5,000.
b. Management expects to sell 7,100 cases of water in August and 9,000 cases in September.
Each case sells for $14. Cash sales average 20% of total sales, and credit sales make up the rest. Three-fourths of credit sales are collected in the month of the sale, with the balance collected the following month.
c. The company pays rent and property taxes of $4,500 each month. Commissions and other selling expenses average 30% of sales. Agua Cool pays one-half of commissions and other selling expenses in the month incurred, with the balance paid the following month?
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Related Book For
Horngrens Accounting
ISBN: 978-0134674681
12th edition
Authors: Tracie L. Miller nobles, Brenda L. Mattison, Ella Mae Matsumura
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