The Bass Company has projected the following quarterly sales amounts for the com

Question

The Bass Company has projected the following quarterly sales amounts for the coming year: Required: Accounts receivable at the beginning of the year are $480. Bass has a 45-day collection period. Calculate cash collections in each of the four quarters by completing the following (b) Accounts receivable at the beginning of the year are $480. Bass has a 60-day collection period. Calculate cash collections in each of the four quarters by completing the following (c) Accounts receivable at the beginning of the year are $480. Bass has a 30-day collection period. Calculate cash collections in each of the four quarters by completing the following

Explanation / Answer

45 days of collection period as one quarter = 90 days, the cash collection in 45 days = Beginning receivables + sales/2 Ending receivables = beginning receivables + sales - cash collection Q1 Q2 Q3 Q4 Beginning Receivables $480 $105 $135 $165 Sales $210 $270 $330 $480 Cash collection $585 $240 $300 $405 Ending receivables $105 $135 $165 $240 60 days of collection period as one quarter = 90 days, the cash collection in 60 days = Beginning receivables + sales*(2/3) Ending receivables = beginning receivables + sales - cash collection Q1 Q2 Q3 Q4 Beginning Receivables $480 $70 $90 $110 Sales $210 $270 $330 $480 Cash collection $620 $250 $310 $430 Ending receivables $70 $90 $110 $160 30 days of collection period as one quarter = 90 days, the cash collection in 30 days = Beginning receivables + sales*(1/3) Ending receivables = beginning receivables + sales - cash collection Q1 Q2 Q3 Q4 Beginning Receivables $480 $140 $180 $220 Sales $210 $270 $330 $480 Cash collection $550 $230 $290 $380 Ending receivables $140 $180 $220 $320

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