TB MC Qu. 8-92 The LaGrange Corporation had the ...

The LaGrange Corporation had the following budgeted sales for the first half of the current year:

		Cash Sales		Credit Sales
January	$	40,000	$	140,000
February	$	45,000	$	160,000
March	$	35,000	$	120,000
April	$	30,000	$	115,000
May	$	40,000	$	190,000
June	$	70,000	$	90,000

The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled:

Collections on sales:

40% in month of sale

45% in month following sale

15% in second month following sale

The accounts receivable balance on January 1 of the current year was $66,000, of which $51,000 represents uncollected December sales and $15,000 represents uncollected November sales.

The total cash collected during January by LaGrange Corporation would be:

Garrison 16e Rechecks 2017-10-03, 2017-10-06

Multiple Choice

• $224,000

• $194,000

• $85,000

• $149,250