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Budgeting Cash Collection Bubbles Consulting, which invoices its clients on terms 2/10, n/30, had credit sales for March and April of $100,000 and $200,000, respectively.
Budgeting Cash Collection
Bubbles Consulting, which invoices its clients on terms 2/10, n/30, had credit sales for March and April of $100,000 and $200,000, respectively. Analysis of the Companys operations indicates that the pattern of customers payments on account is as follows (percentages are of total monthly credit sales):
Determine the estimated cash collected on customers accounts in April.
Receiving Discount | Beyond Discount Period | Totals | |
In month of sale | 50% | 25% | 75% |
in month of following sale | 10% | 10% | 20% |
uncollectible accounts, returns | 5% |
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