Question
Contrick Corporation has the following sales forecasts for the selected three-month period in 2017: Month Sales March $24,000 April $14,000 May $16,000 All sales are
Contrick Corporation has the following sales forecasts for the selected three-month period in 2017: Month Sales
March $24,000
April $14,000
May $16,000
All sales are on account. 60 percent of sales are collected in the month of the sale, and the remainder are collected in the following month.
Accounts receivable balance (March 1, 2017) $16,000
Cash balance (March 1, 2017) $10,000
Minimum cash balance is $10000. Cash can be borrowed in $1000 increments from the local bank (assume no interest charges).
How much cash would be collected in May from sales?
| a. | $16,000 | |
| b. | $26,000 | |
| c. | $15,200
| |
| d. | $9,600 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started