Question
The LaGrange Corporation had the following budgeted sales for the first half of the current year: Cash Sales Credit Sales January $ 70,000 $ 170,000
The LaGrange Corporation had the following budgeted sales for the first half of the current year:
| Cash Sales | Credit Sales | |
|---|---|---|
| January | $ 70,000 | $ 170,000 |
| February | $ 75,000 | $ 190,000 |
| March | $ 32,000 | $ 150,000 |
| April | $ 27,000 | $ 112,000 |
| May | $ 37,000 | $ 220,000 |
| June | $ 100,000 | $ 60,000 |
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
35% in month following sale
15% in second month following sale
The accounts receivable balance on January 1 of the current year was $65,000, of which $52,000 represents uncollected December sales and $13,000 represents uncollected November sales.
What is the budgeted accounts receivable balance on May 31?
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