Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Coyote Loco, Inc., a distributor of salsa, has the following historical collection pattern for its credit sales. 60 percent collected in the month of sale.

Coyote Loco, Inc., a distributor of salsa, has the following historical collection pattern for its credit sales.

60 percent collected in the month of sale.
20 percent collected in the first month after sale.
15 percent collected in the second month after sale.
4 percent collected in the third month after sale.
1 percent uncollectible.

The sales on account have been budgeted for the last seven months as follows:

June $125,000
July 152,500
August 177,500
September 205,000
October 230,000
November 255,000
December 217,500

Required:
1. Compute the estimated total cash collections during October from credit sales.

2.

Compute the estimated total cash collections during the fourth quarter from sales made on account during the fourth quarter.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Content Audits And Inventories A Handbook For Content Analysis

Authors: Paula Ladenburg Land

2nd Edition

1937434826, 978-1937434823

More Books

Students also viewed these Accounting questions

Question

1. How can you distinguish between strategies and policies?

Answered: 1 week ago