Del Spencer is the owner and founder of Del Spencer\'s Men\'s Clothing Store. De
ID: 2525204 • Letter: D
Question
Del Spencer is the owner and founder of Del Spencer's Men's Clothing Store. Del Spencer's has its own house charge accounts and has found from past experience that 10 percent of its sales are for cash. The remaining 90 percent are on credit. An aging schedule for accounts receivable reveals the following patten: 15 percent of credit sales are paid in the month of sale 65 percent of credit sales are paid in the first month following the sale. 14 percent of credit sales are paid in the second month following the sale. 6 percent of credit sales are never collected. Credit sales that have not been paid until the second month following the sale are considered overdue and are subject to a 3 percent late charge Del Spencer's has developed the following sales forecast: May une uly August September 83,000 560,000 55,000 45,000 Required: Prepare a schedule of cash receipts for August and September. Round all amounts to the nearest dollar. Del Spencer's Men's Clothing Store Schedule of Cash Receipts For the Months of August and September August September Cash sales 5.600 8.300 Received from sales in June Juy August September: Total cash receptsExplanation / Answer
Del Spencers Mens Clothing Store
Schedule of cash receipts
For the month of august and September
August
September
Cash sales
$5,600
$8300
Received from sales in
June
$7,138
0
July
$26,325
$5,840
August
$7,560
$32,760
September
0
$11,205
TOTAL
$46,623
$58,105
$7,138 = $55,000 x 0.90 x 0.14 x 1.03
$26,325 = $45000 x0.90 x 0.65
$7560 = $56000 x0.90x 0.15
$5840 = $45000x0.90x0.14 x 1.03
$32760 = $56000x0.90x0.65
$11205 = $83000x0.90x0.15
Del Spencers Mens Clothing Store
Schedule of cash receipts
For the month of august and September
August
September
Cash sales
$5,600
$8300
Received from sales in
June
$7,138
0
July
$26,325
$5,840
August
$7,560
$32,760
September
0
$11,205
TOTAL
$46,623
$58,105
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