Shown below is the sales forecast for Cooper Inc. for the first four months of t

Question

Shown below is the sales forecast for Cooper Inc. for the first four months of the coming year.

                             Jan           Feb          Mar         Apr

Cash Sales        $15,000    $24,000    $18,000   $14,000

Credit Sales    $100,000   $120,000   $90,000   $70,000

On average, 50% of credit sales are paid for in the month of the sale, 30% in the month following sale, and the remainder are paid two months after the month of the sale. Assuming there are no bad debts, the expected cash inflow in March is:

$138,000

$122,000

$119,000

$108,000

$138,000

$122,000

$119,000

$108,000

Explanation / Answer

Expected cash Flow for March March Cash sales 18,000 Credit sale March (90,000*50%) 45,000 Feb (120,000*30%) 36,000 Jan (100,000*20%) 20,000 Expected cash flow for March 119,000 answer answer) option C

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