Ortiz Company estimates the following sales for 2021:

Q1 - 200 units

Q2 - 260 units

Q3 - 330 units

Q4 - 300 units

All sales are on account, and each unit sells for $35. Ortiz Company collects 90% of sales in the quarter of the sale and 10% in the following quarter. At January 1, 2021, the balance in Accounts Receivable is $950.

What are expected cash collections in Q1 of 2021?

• A.

  $7,250

• B.

  $7,000

• C.

  $6,300

• D.

  $5,350