Shadee Corp. expects to sell 530 sun visors in May and 440 in June. Each visor s

Question

Shadee Corp. expects to sell 530 sun visors in May and 440 in June. Each visor sells for $15. Shadee’s beginning and ending finished goods inventories for May are 80 and 50 units, respectively. Ending finished goods inventory for June will be 60 units. It expects the following unit sales for the third quarter: July 530 August 450 September 450 Sixty percent of Shadee’s sales are cash. Of the credit sales, 52 percent is collected in the month of the sale, 37 percent is collected during the following month, and 11 percent is never collected.

Required: Calculate Shadee’s total cash receipts for August and September. (Do not round your intermediate calculations. Round your answers to the nearest whole dollar.)

Explanation / Answer

Total Cash Collected in August $6631

Total Cash Collected In September $6453

May June July August September Qty Rate Amount ($) Qty Rate Amount ($) Rate Amount ($) Rate Amount ($) Rate Amount ($) Begning Inventory 80 50 Expeted Sales 530 15 7950 440 15 6600 530 15 7950 450 15 6750 450 15 6750 Ending Inventory 50 60 1:Cash Sales 60% 318 15 4770 264 15 3960 318 15 4770 270 15 4050 270 15 4050 Credit sales 212 15 3180 176 15 2640 212 15 3180 180 15 2700 180 15 2700 Collection from Credit Sales 2:Cash (52% of Cr salesin the same month) 1653.6 1372.8 1653.6 1404 1404 3:Cash (37% of Cr sales in following month) 1176.6 976.8 1176.6 999 11% Never Collected 349.8 290.4 349.8 297 297 Total Cash Collected ($) 6424 6509 7400 6631 6453 (1+2+3)

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