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  3. the following information for the second quarter o

The following information for the second quarter of 2011 pertains to Huffington Company: ...

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Accounting

The following information for the second quarter of 2011 pertains to Huffington Company:

Month

Sales

Purchases

April

$90,000

$48,000

May

$120,000

$60,000

June

$150,000

$84,000

* Cash is collected from customers in the following manner:

Month of sale

30%

Month following the sale

70%

* 40% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month.

* Labor costs are 20% of sales. Other operating costs are $45,000 per month (including $12,000 of depreciation). Both of these are paid in the month incurred.

*The cash balance on June 1 is $6,000. A minimum cash balance of $4,500 is required at the end of the month. Money can be borrowed in multiples of $3,000.

*No loans outstanding on June 1.

How much cash will be collected from customers in June?

A.

$129,000

B.

$150,000

C.

$141,000

D.

None of the above is correct.

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