Northwasetren Company budgeted the following credited sales during the current y

Question

Northwasetren Company budgeted the following credited sales during the current year. September $75,000.00.

October $108,000.00 . November$ 90,000.00. December$ 96,000.00.

Experience has shown that cash from credit sales is received as follows:
10% in the month of sale.

50% in the first month after sale.

35% in the second month after sale.

5% is uncollectible.

All collections in the month of sale are subject to 2 % cash discount.

Required:

How much total cash can Northwasetren Company expect to collect in December?

Explanation / Answer

How much total cash can Northwasetren Company expect to collect in December?

December October sales (108000*35%) 37800 November sales (90000*50%) 45000 December sales (96000*10%)*98% 9408 Total cash collection in december 92208

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