The next two questions are based on the following: Budgeted sales and cash collections for the Lehman Corporation for Quarter 1 are listed below: Cash Sales Credit Sales Total Sales January $125,000 ? ? February $100,000 $260,000 $360,000 March $85,000 $195,000 $280,000 Collections on credit sales are as follows: Month of sale 60% Month after sale 30% 2nd month after sale 10% 7 If the total cash collected in March was $320,000, then total January sales must have been: A. $400,000 B. $1,375,000 C. $525,000 D. $40,000 E. None of the above 8 A. $120,000 B. $138,750 C. $18,750 , D. $198,750 E. None of the above The accounts receivable balance on January 1 is $175,000, of which $75,000 represents uncollected December sales and $100,000 represents uncollected November sales. If January credit sales were $300,000, (ignore any answer derived for previous question), the accounts receivable balance as of the end of January would be: