Question
A company estimates the following sales demand from Jan July 2021: Month Sales (Units) Jan 150,000 Feb 180,000 March 120,000 April 240,000 May 210,000 June
A company estimates the following sales demand from Jan July 2021:
| Month | Sales (Units) |
| Jan | 150,000 |
| Feb | 180,000 |
| March | 120,000 |
| April | 240,000 |
| May | 210,000 |
| June | 180,000 |
| July | 240,000 |
Cash sales account for 50% of the total sales. Debtors are granted 2 months credit, of which half is collected in the month following sales, and the other half after 2 months. Determine the collection from sales in each of the months from April June 2021. Explain how the credit policy offered by a company affects the budgeting exercise. (All workings must be clearly shown)
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Cost Accounting A Managerial Emphasis
Authors: Charles T. Horngren, Srikant M.Dater, George Foster, Madhav
14th Edition
978-0132960649, 132960648, 132109174, 978-0132109178
