Minot Corporation is preparing its cash budget for August. The following informa

Question

Minot Corporation is preparing its cash budget for August. The following information is available concerning its accounts receivable:

Minot Corporation is preparing its cash budget for August. The following information is available concerning its accounts receivable $ 220,000 $167,000 Estimated credit sales for August Actual credit sales for July Estimated collections in August for credit sales in August Estimated collections in August for credit sales in July Estimated collections in August for credit sales prior to July Estimated write-offs in August for uncollectible credit sales Estimated provision for bad debts in August for credit sales in August 25% 70% $18,000 $ 8,000 $ 7,800 Required: What is the estimated amount of cash receipts from accounts receivable collections in August? Estimated cash receipts

Explanation / Answer

Estimated Cash Receipts : $189,900

Minot Corporation Cash budget for August Particulars Calcuation Amount Estimated collections in August for credit sales in August 220,000 X 25% $55,000 Estimated collections in August for credit sales in July 167,000 X 70% 116,900 Estimated collections in August for credit sales in prior to July 18,000 Estimated Cash Receipts 189,900

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