Solution-Create a schedule of budgeted cash collections

Create a schedule of budgeted cash collections from sales

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Reference no: EM131693722

Cash Receipts - The sales budget for Andrew Inc. is forecasted as follows:

Month Sales Revenue May$ 170,000 June 210,000 July 230,000 August 170,000

The company must determine the budgeted cash collections from sales. Historically, the following trend has been established regarding cash collection of sales:

50 percent in the month of sale.
25 percent in the month following sale.
20 percent in the second month following sale.
5 percent uncollectible.

The company gives a 2 percent cash discount for payments made by customers during the month of sale. The accounts receivable balance on April 30 is $34,000, of which $10,000 represents uncollected March sales and $24,000 represents uncollected April sales.

Create a schedule of budgeted cash collections from sales for May, June, and July. Include a three-month summary of estimated cash collections.

Reference no: EM131693722

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Create a schedule of budgeted cash collections from sales

Reference no: EM131693722

Reference no: EM131693722

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