Question

In: Accounting

Exercise 13-36 Estimate Cash Receipts (LO 13-5) Varmit-B-Gone is a pest control service that operates in...

Exercise 13-36 Estimate Cash Receipts (LO 13-5)

Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to make service calls at least once a month to all homes that subscribe to its service. It makes more frequent calls during the summer. The number of subscribers also varies with the season. The number of subscribers and the average number of calls to each subscriber for the months of interest follow:

Subscribers Service calls (per subscriber)
March 450 0.6
April 600 0.8
May 1,150 1.3
June 1,400 2.3
July 1,650 3.2
August 1,350 2.2


The average price charged for a service call is $50. Of the service calls, 20 percent are paid in the month the service is rendered, 70 percent in the month after the service is rendered, and 8 percent in the second month after. The remaining 2 percent is uncollectible.


Required:

What are Varmit-B-Gone’s expected cash receipts for May, June, July, and August?

Solutions

Expert Solution

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to...
Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to make service calls at least once a month to all homes that subscribe to its service. It makes more frequent calls during the summer. The number of subscribers also varies with the season. The number of subscribers and the average number of calls to each subscriber for the months of interest follow: Subscribers Service calls (per subscriber) March 800 0.6 April 900 0.9 May...
Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to...
Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to make service calls at least once a month to all homes that subscribe to its service. It makes more frequent calls during the summer. The number of subscribers also varies with the season. The number of subscribers and the average number of calls to each subscriber for the months of interest follow: Subscribers Service calls (per subscriber) March 450 0.6 April 550 0.8 May...
Exercise 13-31 Estimate Purchases and Cash Disbursements (LO 13-4, 5) Lakeside Components wishes to purchase parts...
Exercise 13-31 Estimate Purchases and Cash Disbursements (LO 13-4, 5) Lakeside Components wishes to purchase parts in one month for sale in the next. On June 1, the company has 14,000 parts in stock, although sales for June are estimated to total 12,100 parts. Total sales of parts are expected to be 9,200 in July and 14,600 in August. Parts are purchased at a wholesale price of $25. The supplier has a financing arrangement by which Lakeside Components pays 70...
13. In which journal is a sale on account recorded? A. Cash Receipts B. Cash Payments...
13. In which journal is a sale on account recorded? A. Cash Receipts B. Cash Payments C. Purchases D. Sales E. None of the above 14. In which journal is a purchase return recorded? A. Cash Receipts B. Cash Payments C. Purchases D. Sales E. None of the above 15. In which journal is the cash sale of merchandise inventory recorded? A. Cash Receipts B. Cash Payments C. Purchases D. Sales E. None of the above 16. In which journal...
Exercise 14-13 Preparing a cash budget LO 14-5 The accountant for Rooney’s Dress Shop prepared the...
Exercise 14-13 Preparing a cash budget LO 14-5 The accountant for Rooney’s Dress Shop prepared the following cash budget. Rooney’s desires to maintain a cash cushion of $17,000 at the end of each month. Funds are assumed to be borrowed and repaid on the last day of each month. Interest is charged at the rate of 3 percent per month. Required Complete the cash budget by filling in the missing amounts. Determine the amount of net cash flows from operating...
Exercise 10-31 Cash Receipts and Payments [LO 10-4] Information pertaining to Noskey Corporation’s sales revenue follows:...
Exercise 10-31 Cash Receipts and Payments [LO 10-4] Information pertaining to Noskey Corporation’s sales revenue follows: November 2018 (Actual) December 2018 (Budgeted) January 2019 (Budgeted) Cash sales $ 115,000 $ 121,000 $ 74,000 Credit sales 282,000 409,000 208,000 Total sales $ 397,000 $ 530,000 $ 282,000 Management estimates 5% of credit sales to be uncollectible. Of collectible credit sales, 60% is collected in the month of sale and the remainder in the month following the month of sale. Purchases of...
Exercise 13-32 (LO. 5) Andrea is an employee of Fern Corporation and single. She also has...
Exercise 13-32 (LO. 5) Andrea is an employee of Fern Corporation and single. She also has her own business working as a life coach. For 2019, Andrea's wages from Fern were $210,000. Her self-employment income was $30,000 (line 4, Form SE, based on 92.35% of net earnings as a life coach). If required, round any computations to two decimal places. Round final answers to the nearest dollar. a. Compute the total payroll, self-employment, and additional Medicare taxes for Andrea for...
Problem 2-33 Free Cash Flow (LG2-5) The 2021 income statement for Duffy’s Pest Control shows that...
Problem 2-33 Free Cash Flow (LG2-5) The 2021 income statement for Duffy’s Pest Control shows that depreciation expense was $201 million, EBIT was $512 million, and the tax rate was 30 percent. At the beginning of the year, the balance of gross fixed assets was $1,582 million and net operating working capital was $421 million. At the end of the year, gross fixed assets was $1,833 million. Duffy’s free cash flow for the year was $425 million. Calculate the end-of-year...
Exercise 16-36 (Algo) Variable Cost Variances (LO 16-5) Paynesville Corporation manufactures and sells a preservative used...
Exercise 16-36 (Algo) Variable Cost Variances (LO 16-5) Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 128,000 liters at a budgeted price of $285 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials (2 pounds @ $18) $ 36 Direct labor (0.5 hours @ $52) 26 Variable overhead is applied...
Exercise 7-28 Departmental Cost Allocation [LO 7-3, 7-5] HomeLife Life Insurance Company has two service departments...
Exercise 7-28 Departmental Cost Allocation [LO 7-3, 7-5] HomeLife Life Insurance Company has two service departments (actuarial and premium rating) and two production departments (advertising and sales). The distribution of each service department’s efforts (in percentages) to the other departments is shown in the following table: To From Actuarial Premium Rating Advertising Sales Actuarial — 80 % 10 % 10 % Premium 20 % — 20 60 The direct operating costs of the departments (including both variable and fixed costs)...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT