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Nieto Company’s budgeted sales and direct materials purchases are as follows. Budgeted Sales Budgeted D.M. Purchases...

Nieto Company’s budgeted sales and direct materials purchases are as follows.

Budgeted Sales

Budgeted D.M. Purchases
January $215,000 $33,800
February 253,000 44,500
March 262,000 39,200


Nieto’s sales are 30% cash and 70% credit. Credit sales are collected 10% in the month of sale, 50% in the month following sale, and 36% in the second month following sale; 4% are uncollectible. Nieto’s purchases are 50% cash and 50% on account. Purchases on account are paid 40% in the month of purchase, and 60% in the month following purchase.

(a)

Prepare a schedule of expected collections from customers for March.

(b)

Prepare a schedule of expected payments for direct materials for March.

Business   Accounting   
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