E22-27 Preparing a financial budget-schedule of cash receipts, sensitivity analysis Armand Company projects the following sales for the first three months of the year: $10,600 in January; $12,300 in February; and $12,900 in March. The company expects 60% of the sales to be cash and the remainder on account. Sales on account are collected 50% in the month of the sale and 50% in the following month. The Accounts Receivable account has a zero balance on January 1. Round to the nearest dollar. Requirements 1. Prepare a schedule of cash receipts for Armand for January, February, and March. What is the balance in Accounts Receivable on March 31? 2. Prepare a revised schedule of cash receipts if receipts from sales on account are 60% in the month of the sale, 30% in the month following the sale, and 10% in the second month following the sale. What is the balance in Accounts Receivable on March 31? Requirements 1. Prepare a schedule of cash receipts for Armand for January, February, and March. What is the balance in Accounts Receivable on March 31? 2. Prepare a revised schedule of cash receipts if receipts from sales on account are 60% in the month of the sale, 30% in the month following the sale, and 10% in the second month following the sale. What is the balance in Accounts Receivable on March 31? Solution: Requirement 1 Schedule of Cash Receipts from Customers Total Sales Cash Receipts from Customers Accounts Receivable Balance, January 1 January February March Total $10,600 Calculate and show below the Accounts Receivable Balance as of March 31 Requirement 2 Revised Schedule of Cash Receipts from Customers Accounts Receivable balance, March 31: February - Credit sales (finish this January February March Total Amount