Question
Corporation had the following budgeted sales for the first half of the current year: Cash Sales Credit Sales January $ 70,000 $ 170,000 February $
Corporation had the following budgeted sales for the first half of the current year:
| Cash Sales | Credit Sales | |||
| January | $ | 70,000 | $ | 170,000 |
| February | $ | 75,000 | $ | 190,000 |
| March | $ | 45,000 | $ | 150,000 |
| April | $ | 40,000 | $ | 125,000 |
| May | $ | 50,000 | $ | 220,000 |
| June | $ | 100,000 | $ | 190,000 |
The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled:
Collections on sales:
45% in month of sale
40% in month following sale
15% in second month following sale
The accounts receivable balance on January 1 of the current year was $69,000, of which $44,000 represents uncollected December sales and $25,000 represents uncollected November sales.
The total cash collected during January by LaGrange Corporation would be:
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored 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
