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Morgan Company's budgeted income statement reflects the following amounts: Sales Purchases Expenses January $ 120,000...

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Accounting

Morgan Company's budgeted income statement reflects the following amounts: Sales Purchases Expenses January $ 120,000 $ 79,100 $ 24,400 February 110,000 67,100 24,600 March 125,000 82,350 27,400 April 130,000 85,600 29,000 Sales are collected 50% in the month of sale, 30% in the month following sale, and 19% in the second month following sale. One percent of sales is uncollectible and expensed at the end of the year. Morgan pays for all purchases in the month following purchase and takes advantage of a 3% discount. The following balances are as of January 1: Cash $ 88,000 Accounts receivable* 58,000 Accounts payable 72,000 *Of this balance, $25,000 will be collected in January and the remaining amount will be collected in February. The monthly expense figures include $5,000 of depreciation. The expenses are paid in the month incurred. Morgans budgeted cash payments in February are: Multiple Choice $77,127. $96,327. $98,867. $101,327. $103,867

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