UNIT 8 $6,860 ($9,800 X .70) COST OF NEXT 7 UNITS = (8 X $6,860...

73. Correct answer c. Cooper’s cash balance will increase $112,500 as shown below.

Opening balance $100,000 February A/R +800,000

A/R balance +300,000 February A/P - 425,000

A/P balance - 500,000 February Other - 175,000

January A/R +700,000 March A/R* +200,000

January A/P - 350,000 March A/P** - 112,500

January Other - 150,000 March Other - 175,000

Cash balance $212,500

Less opening 100,000

Cash increase $112,500

105

* $500,000 x .4

** $225,000 x .5