Shadee Corp. expects to sell 500 sun visors in May and 430 in June. Each visor s

Question

Shadee Corp. expects to sell 500 sun visors in May and 430 in June. Each visor sells for $13. Shadee’s beginning and ending finished goods inventories for May are 85 and 45 units, respectively. Ending finished goods inventory for June will be 55 units.

It expects the following unit sales for the third quarter:      

Sixty percent of Shadee’s sales are cash. Of the credit sales, 54 percent is collected in the month of the sale, 38 percent is collected during the following month, and 8 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.)

July 560 August 490 September 450

Explanation / Answer

Answer:-

Explanation:-

Statement of cash collection from debtors Particulars August September Sales $ 490 units*$13 per unit=6370 450 units*$13 per unit=5850 Cash Collection 54% in month of sale 6370*54%=3439.80 5850*54%=3159 38% in following month of sale 7280*38% =2766.40 6370*38%=2420.60 Total collection 6206 5580

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