Explore BrainMass

Explore BrainMass

    Collection of receivables and ending balance

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Can you help me get started on this assignment?

    For a company accounts receivables balances as a percentage of a March's sales are 95% of March's sales, 55% of February's sales, and 20% of January's.

    If this pattern continues, what is the estimated percentage of cash flows from April sales, March sales, February, and January scales that are expected to be collected in April?

    If January Sales were $100,000, February Sales $200,000; March Sales $300,000, and April Sales $400,000, what is the Accounts Receivables Balance in April (assuming the same AR accounts receivable pattern as given in March).

    © BrainMass Inc. brainmass.com June 4, 2020, 12:14 am ad1c9bdddf
    https://brainmass.com/business/accounts-receivable-management/collection-receivables-ending-balance-327054

    Solution Preview

    Based on the AR balances, the collection pattern is
    5% of sales in the month (95% of March is not collected)
    40% in the second month (total 45% collected and 55% of Feb is outstanding)
    35% ...

    Solution Summary

    The solution explains how to calculate the cash collection from receivables and the balance in the accounts receivable.

    $2.19

    ADVERTISEMENT