Nanaimo Candy Company (NCC) expects sales for the first six months of 2010 to show the following pattern. Previously, NCC made sales on the basis of a cash-only policy. For 2010, NCC will institute a net 30 (n30) payment policy for its customers. NCC expects that, on average, 40% of credit sales will be collected in the month following the sale, 30% in the next month, and 25% in the third month after the sale. The remainder are written off as bad debts.

Required:
Prepare the cash flow pattern for sales for the January to June period in 2010.

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lan Feb Mar Apr May Jun Total monthly sales $ 125,000 $135,000 $145,000 $155,000 $165,000 $175,000 % cash sales 10% 11% 12% 13% 14% 15%