E8-11 Calculating Cash Receipts [LO 8-4] Shadee Corp. expects to sell 620 sun vi

Question

E8-11 Calculating Cash Receipts [LO 8-4]

Shadee Corp. expects to sell 620 sun visors in May and 330 in June. Each visor sells for $13. Shadee’s beginning and ending finished goods inventories for May are 70 and 40 units, respectively. Ending finished goods inventory for June will be 65 units.

It expects the following unit sales for the third quarter:      

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

August September Cash sales 3510 3510 Credit sales: July 1020 August 1217 866 September 1217 Total cash receipts 5747 5593

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