QS 22-22 (Algo) Computing budgeted accounts receivable LO P2

1.Kingston budgets total sales for June and July of $330,000 and $478,000, respectively. Cash sales are 65% of total sales. Of the credit sales, 15% are collected in the month of sale, 60% are collected during the first month after the sale, and the remaining 25% are collected in the second month after the sale. Determine the amount of accounts receivable reported on the companys budgeted balance sheet as of July 31. Hint: Determine the percent of June and July sales that are uncollected at July 31.

2.Santos Company is preparing a cash budget for February. The company has $16,000 cash at the beginning of February and budgets $71,000 in cash receipts from sales and $117,000 in cash payments during February. Prepare the cash budget for February assuming the company maintains a $6,000 minimum cash balance and will take a loan if necessary to maintain this balance. The company has no loans outstanding on February 1. (Negative cash balances, if any, should be indicated with minus sign.)