Question
The LaGrange Corporation had the following budgeted sales for the first half of the current year: Cash Sales Credit Sales January $90,000 $190,000 February $95,000
The LaGrange Corporation had the following budgeted sales for the first half of the current year:
| Cash Sales | Credit Sales | |
|---|---|---|
| January | $90,000 | $190,000 |
| February | $95,000 | $210,000 |
| March | $47,000 | $170,000 |
| April | $42,000 | $127,000 |
| May | $52,000 | $240,000 |
| June | $120,000 | $210,000 |
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:
50% in month of sale
25% in month following sale
25% in second month following sale
The accounts receivable balance on January 1 of the current year was $73,000, of which $46,000 represents uncollected December sales and $27,000 represents uncollected November sales.
The total cash collected during January by LaGrange Corporation would be:
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Intermediate Accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
9th Edition
125972266X, 9781259722660
