Realand Ltd.’s budgeted sales for the first three months of 20x12 are as follows
ID: 2540982 • Letter: R
Question
Realand Ltd.’s budgeted sales for the first three months of 20x12 are as follows:
January
$557658
February
921150
March
205000
Realand’s actual sales for December 20x11 were $773829.
Of the total sales, 38% are cash sales and the remainder is on account. The company’s cash collection patterns for sales made on account are as follows:
Collected in the month of sale
21%
Collected in the month following the sale
50%
Collected in the second month following the sale
29%
What are Realand’s budgeted cash collections for the month of February 20x12?
Select one:
a. $781979
b. $431942
c. $119934
d. $696681
January
$557658
February
921150
March
205000
Explanation / Answer
budgeted cash collections for the month of February 20x12=Cash sales for February+0.21Credit sales forFebruary+0.5*Credit sales for January+0.29Credit sales for December
=350037+(571113*0.21)+(345747.96*0.5)+(479773.98*0.29)]
which is equal to
=$781979(Approx)
Cash sales(38%) Credit sales(62%) December 294055.02 479773.98 January 211910.04 345747.96 February 350037 $571113Related Questions
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