Suppose a lumber yard has the following data . Accounts receivable, May 31: (0.3

Question

Suppose a lumber yard has the following data . Accounts receivable, May 31: (0.30 x May sales of $356,000) $106,800 Monthly forecasted sales: June, $432,000; July, $446,000; August, $500,000; September, $538,000 . Sales consist of 70% cash and 30% credit. All credit accounts are collected in the month following the sales. Uncollectible accounts are neal gible and may be ignored Requirement 1. Prepare a sales budget schedule and a cash collections budget schedule for June, July, and August. Requirement 1. Prepare a sales budget schedule for June, July, and August. Sales budget June July August Credit sales Cash sales Total sales Prepare a cash collections budget schedule for June, July, and August. Cash collections budget June July August Cash sales this month 100% of last months credit sales Total collections from customers

Explanation / Answer

Sales budget

Cash collection budget :

June July August Cash sales 302400 312200 350000 Credit sales 129600 133800 150000 Total sales 432000 446000 500000

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