Carmens Dress Delivery operates a mail-order business that sells clothes designed for frequent travelers. It had sales of $670,000 in December. Because Carmens Dress Delivery is in the mail-order business, all sales are made on account. The company expects a 30 percent drop in sales for January. The balance in the Accounts Receivable account on December 31 was $96,700 and is budgeted to be $72,500 as of January 31.

Required

1. Determine the amount of cash Carmens Dress Delivery expects to collect from accounts receivable during January.

Expected Cash Collection