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
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 | $ | 30,000 | $ | 170,000 |
| April | $ | 25,000 | $ | 110,000 |
| May | $ | 35,000 | $ | 240,000 |
| June | $ | 120,000 | $ | 40,000 |
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
40% in month following sale
10% in second month following sale
The accounts receivable balance on January 1 of the current year was $65,000, of which $50,000 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
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$325,000
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$250,000
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$100,000
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$240,000
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