US Sports Company projects the following sales:
April May June
$75,000 $95,000 $110,000
Ninety percent of US' sales are on credit with 60 percent of receivables collected in the month after the sale and the rest of receivables are collected in the second month after the sale. February sales were $60,000 and March sales were $70,000. In the past US' bad debt percentage has been zero and is expected to continue at that level.
a) Prepare a monthly schedule for cash receipts for April through June.
b) What is the balance of Receivables at the end of June?© BrainMass Inc. brainmass.com October 24, 2018, 8:04 pm ad1c9bdddf
a. The collection schedule is 10% cash ( in the month) remaining 90% - 60% in the next month and 30% in the month after that
- 10% of April Sales = 7,500
- 30% ...
The solution explains how to prepare a schedule of cash receipts and the ending receivables
Budgeted Cash Receipts and Budgeted Accounts Receivable
Use the following to answer the questions:
The Kafusi Company has the following budgeted sales:
April May June July
Credit Sales $320,000 $300,000 $350,000 $400,000
Cash Sales $70,000 $80,000 $90,000 $70,000
The regular pattern of collection of credit sales is 30% in the month of sale, 60% in the month following the month of sale, and the remainder in the second month following the month of sale. There are no bad debts.
The budgeted cash receipts for July would be:
The budgeted accounts receivable balance on May 31 would be: