Sales and cash receipts budgets Microbit Company has just developed a new micro- switch that will be marketed for the first time in January, 1993. The initial selling price of the switch is $1.20 each but the company plans to increase the price by 5 percent on July 1. The following quarterly sales of the switch are expected:

The company sells 10 percent of its products for cash and 90 percent on open account. It collects 80 percent of its receivables in the quarter of sales, and the remainder in the following quarter.

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First quarter .... 9,000 Second quarter. 12,000 Third quarter 17,500 Fourth quarter 15,000