Question
Baby Company had credit sales of RM1,000,000, RM1,500,000 and RM800,000 in October, November and December 2021, respectively. The companys credit sales projections for January through
Baby Company had credit sales of RM1,000,000, RM1,500,000 and RM800,000 in October, November and December 2021, respectively. The companys credit sales projections for January through March of 2022 are as follows:
January RM3,000,000
February RM2,400,000
March RM2,000,000
Baby Company has normally collected 60% of its credit sales in the month following the sale, 30% in the second following month and 10% in the third month. Assuming this collection pattern continues, prepare a schedule of cash receipts from receivables collection for the period January through March of 2022 (for the month of January, February and March).
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