Harold's Expects Its September Sales to Be 20% Higher Than

Multiple Choice

Harold's expects its September sales to be 20% higher than its August sales of $150,000. Purchases were $100,000 in August and are expected to be $120,000 in September. All sales are on credit and are collected as follows: 30% in the month of the sale and 70% in the following month. Merchandise purchases are paid as follows: 25% in the month of purchase and 75% in the following month. The beginning cash balance on September 1 is $7,500. The ending cash balance on September 30 would be:

A) $31,500.
B) $67,500.
C) $54,000.
D) $61,500.
E) $136,500.