In preparing its budget for July, Wade Inc. has the following information available: Accounts Receivable at June

Question:

In preparing its budget for July, Wade Inc. has the following information available:

Accounts Receivable at June 30 ...................$750,000

Estimated credit sales for July .................... 900,000

Estimated collections in July for credit sales in July and prior months ..... 660,000

Estimated write-off s in July for uncollectible credit sales ........... 27,000

Estimated provision for uncollectible accounts for credit sales in July ..... 20,000

a. What is the projected balance of Accounts Receivable at July 31?

b. Which of these amounts (if any) will affect the cash budget?

c. Which of these amounts (if any) will affect the budgeted income statement for July?

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...