The following is the sales budget for Kulp, Inc., for the first quarter of 2012:

ID: 2710848 • Letter: T

Question

Credit sales are collected as follows:

The accounts receivable balance at the end of the previous quarter was $92,000 ($62,000 of which was uncollected December sales).

Calculate the sales for November.

Calculate the sales for December

Calculate the cash collections from sales for each month from January through March.

January $

Febuary $

March $

The following is the sales budget for Kulp, Inc., for the first quarter of 2012:

January February March Sales budget $ 208,000 $ 228,000 $ 251,000

Credit sales are collected as follows:

55 percent in the month of the sale 30 percent in the month after the sale 15 percent in the second month after the sale

The accounts receivable balance at the end of the previous quarter was $92,000 ($62,000 of which was uncollected December sales).

Calculate the sales for November.

Calculate the sales for December

Calculate the cash collections from sales for each month from January through March.

January $

Febuary $

March $

Let Nov sales be "a" and Dec saled be "b"

According to the question since in december the account receivable is the sum of 15% of Nov sales and 45% of december sales.

0.15a+0.45b=92,000

given 0.45b=62,000 and b =$137,777.78

a=$200,000

Cash Collection :

January= 15% of Nov sales+30% of Dec sales+ 55% of Jan sales

=(0.15*200000)+(.3*137777.78)+(0.55*208000)= $185,733,3

February= 15% of dec sales+30% of jan sales+55% of feb sales

=(0.15*137777.78)+(.3*208000)+(0.55*228000)= $208,466.55

March= 15% of jan sales+30% of Feb sales+55% of Mar sales

=(.15*208000)+(0.3*228000)+(0.55*251000)=$237,650

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