Cash projections and schedule of cash receipts
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3. Gibson Manufacturing Corp. expects to sell the following number of units of steel cables at the prices indicated under three different scenarios in the economy. The probability of each outcome is indicated. What is the expected value of the total sales projection?
Outcome Probability Units Price
A 0.20 100 $20
B 0.50 180 25
C 0.30 210 30
14. Victoria's Apparel has forecast credit sales for the fourth quarter of the year as:
September (actual) . . . . . . . . . . $50,000
Fourth Quarter
October . . . . . . . . . . . . . . . . . . . $40,000
November . . . . . . . . . . . . . . . . . 35,000
December . . . . . . . . . . . . . . . . . 60,000
Experience has shown that 20 percent of sales are collected in the month of sale, 70 percent in the following month, and 10 percent are never collected. Prepare a schedule of cash receipts for Victoria's Apparel covering the fourth quarter (October through December).
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3. Gibson Manufacturing Corp. expects to sell the following number of units of steel cables at the prices indicated under three different scenarios in the economy. The probability of each outcome is indicated. What is the expected value of the total ...
Purchase this Solution
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