Parson Corporation, a wholesaler, provided the following information:

Month	Merchandise Purchases				Sales
January	$	151,000			$	190,000
February		157,000				184,000
March		145,000				183,000
April		163,000				196,000
May		169,000				184,000

Customers pay 65% of their balances in the month of sale, 25% in the month following sale, and 10% in the second month following sale. The company pays all invoices in the month following purchase. Cash payments for operating expenses in May will be $124,000; Parson’s cash balance on May 1 was $136,800.

Required:
A. Determine the expected cash collections during May.
B. Determine the expected cash disbursements during May.
C. Determine the expected cash balance on May 31.

Answer rating: 100% (QA)

Solution Salution A H Raghands B 9 Expected Cash Collection during may 65 of Sales im 10 Sale ... View the full answer