Shadee Corp. expects to sell 650 sun visors in May and 410 in June. Each visor s

Question

Shadee Corp. expects to sell 650 sun visors in May and 410 in June. Each visor sells for $11. Shadee's beginning and ending finished goods inventories for May are 75 and 50 units, respectively. Ending finished goods inventory for June will be 65 units. It expects the following unit sales for the third quarter: August September 545 450 420 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.) August September Total Cash Receipts

Explanation / Answer

Shadee Corp Actual & Budgeted Sales(Units) July 545 August 450 September 420 Sales Budget Months July August September Quarter Budgeted sales(Units) 545 450 420 1415 Selling Price per Unit $                            11.00 $                 11.00 $                   11.00 $                 11.00 Total sales $                      5,995.00 $           4,950.00 $             4,620.00 $         15,565.00 Schedule of expected cash collections Sales August September July Sales($5995*40%*37%) in August $                            5,995 $                 3,597 $                   2,398 August Sales=($4950*60%) in August,($4950*40%*52%) in August and ($4950*40%*37%) in September $                            4,950 $                 4,000 $                      733 September Sales=($4620*60%+((4620*40%*52%)) in September $                            4,620 $                   3,733 Total Cash collections $                 7,597 $                   6,864

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