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Gessel Co.s projected sales are as follows: August $160,000 September $180,000 October $220,000 November $200,000 Gessel estimates that it will collect 30% of sales in
Gessel Co.s projected sales are as follows:
August | $160,000 | September | $180,000 | October | $220,000 | November | $200,000 |
Gessel estimates that it will collect 30% of sales in the month of sale, 50% in the month after the sale, and 18% in the second month following the sale. Two percent of all sales are estimated to be bad debts. Gessel purchases inventories on account totaling $130,000 during August, $140,000 during September, and $100,000 during October. Gessel pays 25% of purchases in the month purchased and 75% in the following month.
- How much is Gessel Co.s budgeted cash receipts for October?
- How much is the net increase or decrease in cash for Gessel for October?
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