Question
ffice World Inc. has cash and carry customers and credit customers. Office World estimates that 20% of monthly sales are to cash customers, while the
ffice World Inc. has "cash and carry" customers and credit customers. Office World estimates that 20% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 20% pay their accounts in the month of sale, while the remaining 80% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows:
October | $128,000 |
November | 160,000 |
December | 234,000 |
The Accounts Receivable balance on September 30 was $86,000.
Prepare a schedule of cash collections from sales for October, November, and December. Round all calculations to the nearest whole dollar.
Office World Inc. | |||
Schedule of Collections from Sales | |||
For the Three Months Ending December 31 | |||
October | November | December | |
Receipts from cash sales: | |||
Cash sales | |||
September sales on account: | |||
Collected in October | |||
October sales on account: | |||
Collected in October | |||
Collected in November | |||
November sales on account: | |||
Collected in November | |||
Collected in December | |||
December sales on account: | |||
Collected in December | |||
Total cash receipts |
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