iPad 10:04 PM ezto.mheducation.com Time remaining: 1:55:54 3. ABC Company\'s bud
ID: 2441337 • Letter: I
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iPad 10:04 PM ezto.mheducation.com Time remaining: 1:55:54 3. ABC Company's budgeted sales for June, July, and August are 15,200, 19,200, and 17,200 units respectively. The selling price for each unit is $15. Based on past experience, ABC expects that 30% of a month's sales will be collected in the month of sale, 60% in the following month, and 7% in the second month following the sale. Required: Prepare an analysis of cash receipts from sales for ABC Company for August. June July August Budgeted sales units Unit selling price Budgeted sales revenue August collections: Current month's sales Prior month's sales Second prior month's sales Total collections eBook & ResourcesExplanation / Answer
Answers
June
July
August
Budgeted Sales Unit
15,200
19,200
17,200
Unit Selling price
$ 15.00
$ 15.00
$ 15.00
Budgeted Sales Revenue
$ 228,000.00
$ 288,000.00
$ 258,000.00
August Collections:
Workings [Credit sale and % collectable]
Current Month's sale
$ 258,000.00
30%
$ 77,400.00
Prior Month's sale
$ 288,000.00
60%
$ 172,800.00
Second prior month's sales
$ 228,000.00
7%
$ 15,960.00
Total collections
$ 266,160.00
June
July
August
Budgeted Sales Unit
15,200
19,200
17,200
Unit Selling price
$ 15.00
$ 15.00
$ 15.00
Budgeted Sales Revenue
$ 228,000.00
$ 288,000.00
$ 258,000.00
August Collections:
Workings [Credit sale and % collectable]
Current Month's sale
$ 258,000.00
30%
$ 77,400.00
Prior Month's sale
$ 288,000.00
60%
$ 172,800.00
Second prior month's sales
$ 228,000.00
7%
$ 15,960.00
Total collections
$ 266,160.00
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