Artemis, Inc. has developed a specialized wholesale business selling archery equipment to sporting goods stores. The Art

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Artemis Inc Has Developed A Specialized Wholesale Business Selling Archery Equipment To Sporting Goods Stores The Art 1 (152.58 KiB) Viewed 8 times

Artemis, Inc. has developed a specialized wholesale business selling archery equipment to sporting goods stores. The Artemis cost accountants are going through their quarterly budgeting process and have determined that: Sales (in dollars) are expected to be $380,000 for January, $390,000 for February, and $370,000 for March. The company expects to collect cash from credit sales according to this pattern: 50% in the month of sale and 50% in the month following the sale. • Cost of goods sold is expected to be approximately 75% of sales. • Artemis would like to have inventory at the end of each month equal to 30% of the cost of goods sold budgeted for the following month. When Artemis purchases archery equipment for its suppliers, they generally make payment in the month following the purchase. ● • At January 1, the beginning balance in the accounts receivable account is $73,000. At January 1, the beginning balance in the accounts payable account is $260,000. Required: a. Prepare a Schedule of Expected Cash Collections for January and February b. Prepare a Merchandise Purchases Budget for January and February