The Shoe Company, a Merchandising Firm, Has Budgeted Its Activity

Multiple Choice

The Shoe Company, a merchandising firm, has budgeted its activity for April according to the following information:

I. Sales at $650,000, all for cash.
II. Merchandise inventory on March 31st was $300,000.
III. Budgeted depreciation for April is $35,000.
IV. The cash balance at April 1 was $25,000.
V. Selling and administrative expenses are budgeted at $60,000 for April and are paid in cash.
VI. The planned merchandise inventory on April 30 is $270,000.
VII. The invoice cost for merchandise purchases represents 75% of the sales price. All purchases are paid for in cash.

-What are the budgeted cash receipts for April?

A) $137,500.
B) $412,500.
C) $650,000.
D) $585,000.