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I need help with my master budget assignment, don't know how to do the schedule of expected cash collections Master Budget Case- Explore Scientific Inc.
I need help with my master budget assignment, don't know how to do the schedule of expected cash collections
Master Budget Case- Explore Scientific Inc. Explore Scientific Inc. is a company that manufactures and sells a single product, which they call LX200. For planning and control purposes they utilize a monthly master budget, which is usually developed at least six months in advance of the budget year. Their fiscal year end is December 31 Their sales forecast consisted of these few lines: . For the year ended December 31, 2019: 450,000 units at $11.00 each* For the year ended December 31, 2020: 600,000 units at $11.00 each For the year ended December 31, 2021: 600,000 units at $12.00 each Expected sales for the year ended December 31, 2019 are based on actual sales to date and budgeted sales for the duration of the year. 11. Sales are on a cash and credit basis, with 55% collected during the month of the sale, 35% the following month, and 9.5% the month thereafter. uncollectible (bad debt expense) of 1% of sales are considered 12. Sales in November and December 2019 are expected to be $990,000 and $1,980,000 respectively. Based on the above collection pattern this will result in Accounts Receivable of $975,150 at December 31, 2019 which will be collected in January and February, 2020Step by Step Solution
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