Browning Company\'s sales budget shows the following expected total sales: Month

Question

Browning Company's sales budget shows the following expected total sales:

Month Sales
January $16,000
February $20,000
March $25,000
April $48,000

The company expects 70% of its sales to be on account (credit sales). Credit sales are collected as follows: 25% in the month of sale, 70% in the month following the sale with the remainder being uncollectible and written off in the month following the sale. The total cash inflows from the collection of receivables in April would be:
A. $20,650.
B. $19,925.
C. $25,200.
D. $35,200.

Explanation / Answer

March Credit = 25000 * .7 * .70 = 12250 April Credit = 48000 * .7 * .25 = 8400 so A.

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.