- Calculate the budgeted total cash receipt for November and December
b. Calculate budgeted cash disbursements for November and December
Determine for Papst Company for the month of May:
1. The estimated cash receipts from accounts receivable collections.
2. The gross amount of accounts receivable at the end of the month (after appropriate write-off of uncollectible accounts).
3. The net amount of accounts receivable at the end of the month.
- 4. Recalculate requirements 1 and 2 under the assumption that estimated collections in the month of saleequal 60% and in the first month following the month of sale equal 25%.
Skipped Timpco, a retailer, makes both cash and credit sales (i.e.. sales on open account). Information regarding budgeted sales for the last quarter of the year is as follows: October November December Cash sales 5 140,000 $ 115,000 $ 105,000 Credit sales 140,000 138,000 115,500 Total $ 280,000 $ 253,000 $ 220,500 [ Past experience shows that 5% of credit sales are uncollectible. Of the credit sales that are collectible, 60% are collected in the month of sale; the remaining 40% are collected in the month following the month of sale. Customers are granted a 1.5% discount for payment within 10 days of billing. Approximately 75% of collectible credit sales take advantage of the cash discount. Inventory purchases each month are 100% of the cost of the following months projected sales. (The gross profit rate for Timpco is approximately 30%.) All merchandise purchases are made on credit, with 20% paid in the month of purchase and the remainder paid in the following month. No cash discounts for early payment are in effect. Required: 1. Calculate the budgeted total cash receipts for November and December. (Round your intermediate calculations and final answers to the nearest whole dollar amount.) 2. Calculate budgeted cash disbursements for November and December (budgeted total sales for January of the coming year equals $205,000). 2. Budgeted cash disbursements Papst Company is preparing its cash budget for the month of May. The following information is available concerning its accounts receivable (based on sales made to customers on open account): Actual credit sales for March $210,000 Actual credit sales for April $272,000 Estimated credit sales for May $402,000 Estimated collections in the month of sale 25% Estimated collections in the first month after the month of sale 60% Estimated collections in the second month after the month of sale 10% Estimated provision for bad debts (made in the month of sale) 5% [ The firm writes off all uncollectible accounts at the end of the second month after the month of sale. Required: Determine for Papst Company for the month of May: 1. The estimated cash receipts from accounts receivable collections. 2. The gross amount of accounts receivable at the end of the month (after appropriate writeoff of uncollectible accounts). 3. The net amount of accounts receivable at the end of the month. 4' Recalculate requirements 1 and 2 under the assumption that estimated collections in the month of sale equal 60% and in the rst month following the month of sale equal 25%. Estimated cash receipts Gross accounts receivable Net accounts receivable . Estimated cash receipts 4b. Gross accounts receivable
