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Falcon Ltd is compiling its cash budget for the months of October, November, December and January.
The company had sales of R1 600 000 in August and R2 000 000 in September.
Sales for the following four months are expected to be as follows:
October- R 1 400 000
November- R1 900 000
December - R 2 800 000
January - R 600 000
-A total of 40% of the company's sales are cash and the remainder is on credit.
-A total of 50% of sales are collected one month after the month of sale.
-A total of 10% of sales are collected two months after the month of sale.
Determine the total credit collections that the company will make in December, that is, the total amount collected from past credit sales, in December.
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