Chadmark Corporation’s budgeted monthly sales are $3,000. Forty
percent of its customers pay in the first month and take the 2 percent
discount. The remaining 60 percent pay in the month following the sale
and don’t receive a discount. Chadmark’s bad debts are very small and
are excluded from this analysis. Purchases for next months sales are
constant each month at $1,500. Other payments for wages, rent and
taxes are constant at $700 per month. Construct a single month’s cash
budget with the information given. What is the average cash gain or
(loss) during a typical month for Chadmark Corporation?





0 	0% 	A . 	$2,600
0 	0% 	B . 	$ 800
0 	0% 	C . 	$ 776
0 	0% 	D . 	$ 740
0 	0% 	E . 	$ 728

C. $776

Monthly sales = (3,000 * 40% * 0.98) + (3,000 * %60) = 2,976
Purchases = 1,500
Other pmts = 700

Cash gain = 2,976 - 1,500 - 700 = 776