Refer to Exercise 8-20. Rosita thinks that it may be time to refuse to accept checks and to start accepting credit cards. She is negotiating with VISA/MasterCard and American Express, and she would start the new policy on April 1. Rosita estimates that with the drop in sales from the “no checks” policy and the increase in sales from the acceptance of credit cards, the net increase in sales will be 30 percent. The credit cards do involve added costs as follows:

VISA/MasterCard: Rosita will accumulate these credit card receipts throughout the month and submit them in one bundle for payment on the last day of the month. The money will be credited to her account by the fifth day of the following month. A fee of 3.5 percent is charged by the credit card company.

American Express: Rosita will accumulate these receipts throughout the month and mail them to American Express for payment on the last day of the month. American Express will credit her account by the sixth day of the following month. A fee of 5.5 percent is charged by American Express.

Rosita estimates the following breakdown of revenues among the various payment methods.

Required:
Prepare a schedule of cash receipts for May and June that incorporates the changes in policy. (Round all amounts to the nearest dollar.)LO1

Transcribed Image Text:

Cash 10% VISA/Mastercard 75 American Express 15