Question
Derrick Ltd. has the following budgeted sales for the upcoming four months plus last month: Month Total Budgeted Sales November $590,000 December $656,000 January $595,000
Derrick Ltd. has the following budgeted sales for the upcoming four months plus last month:
| Month | Total Budgeted Sales |
| November | $590,000 |
| December | $656,000 |
| January | $595,000 |
| February | $557,000 |
| March | $569,000 |
| April | $581,000 |
The company has found that 60% of their sales are cash sales and the remainder is on credit.
The company has the following history of accounts receivable collection:
| Percent paid in the month of sale | 30% |
| Percent paid in the month after sale | 65% |
| Percent paid in the second month after sale | 4% |
| Percent lost to uncollective accounts | 1% |
Prepare a schedule of cash receipts for January through April and answer the following questions.
What is the total cash receipts for January?
(HINT: Cornerstone 9.11 in the textbook as well as the Cash Receipts lecture video will help you determine this!)
What is the total cash receipts for February?
What is the total cash receipts for March?
What is the total cash receipts for April?
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
Advanced Accounting
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupni
13th edition
1259444953, 978-1259444951
