QUESTION 8 Answer Question 7-10 based on the following information: Data regarding the Dilly's operations is as follow: Sales are budgeted at $290,000 for November, $310,000 for December, and $210,000 for January. Collections are expected to be 65% in the month of sale and 35% in the month following the sale. The cost of goods sold is 80% of sales. The company desires to have an ending merchandise inventory at the end of each month equal to 70% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are $21,100. Monthly depreciation is $21,000. Ignore taxes. $ Balance Sheet October 31 Assets Cash Accounts receivable Merchandise inventory Property, plant and equipment, net of $624,000 accumulated depreciation Total assets 25,000 77,000 162,400 1,026,000 1,290,400 Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity 239,000 740,000 311,400 1,290,400 Question 7) Expected cash collections in December are: $310,000 $101,500 $303,000 $201,500 QUESTION 9 The cost of December merchandise purchases would be: $248,000 $232,000 $117,600 $192,000 QUESTION 10 The net income for December would be: $19,900 $38,700 $40,900 $13,700 QUESTION 11 Retained earnings at the end of December would be: $325,100 $311,400 $353,400 $347,200