From past experience, the company has learned that 25% of a month’s sales are co
ID: 2337997 • Letter: F
Question
From past experience, the company has learned that 25% of a month’s sales are collected in the month of sale, another 70% are collected in the month following sale, and the remaining 5% are collected in the second month following sale. Bad debts are negligible and can be ignored. May sales totaled $404,000, and June sales totaled $515,000.
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Prepare a schedule of expected cash collections from sales, by month and in total, for the third quarter. (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required.)
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Assume that the company will prepare a budgeted balance sheet as of September 30. Compute the accounts receivable as of that date. (Do not round intermediate calculations.)
Midwest Products is a wholesale distributor of leaf rakes. Thus, peak sales occur in August of each year as shown in the company’s sales budget for the third quarter, given below:Explanation / Answer
Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Particulars July August September Total May sales 20,200.00 20,200.00 June sales 360,500.00 25,750.00 386,250.00 July sales 144,500.00 404,600.00 28,900.00 578,000.00 August sales 207,250.00 580,300.00 787,550.00 September sales 114,750.00 114,750.00 Total cash collections 525,200.00 637,600.00 723,950.00 1,886,750.00 Paticulars Amount August collection pending =829000*.05 41,450.00 September collection pending= 459000*.75 344,250.00 Total accounts receivable as of 30Sep 385,700.00
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