In: Accounting
Schedule of Cash Collections on Accounts Receivable and Cash Budget
Roybal Inc. sells all of its product on account. Roybal has the following accounts receivable payment experience:
Percent paid in the month of sale | 20 | ||
Percent paid in the month after the sale | 55 | ||
Percent paid in the second month after the sale | 23 |
To encourage payment in the month of sale, Roybal gives a 2% cash discount. Roybal's anticipated sales for the next few months are as follows:
April | $237,500 | |
May | 310,000 | |
June | 325,000 | |
July | 300,000 | |
August | 375,000 |
Required:
1. Prepare a schedule of cash receipts for July. Be sure to enter percentages as whole numbers.
Roybal Inc. Schedule of Cash Receipts For July |
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Payments on account: | ||||||
From May credit sales: | ||||||
$ × % | $ | |||||
From June credit sales: | ||||||
$ × % | ||||||
From July credit sales: | ||||||
$ × % | ||||||
Less: July cash discount | ||||||
$ × % | ||||||
Cash receipts | $ |
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Partially correct
2. Prepare a schedule of cash receipts for August. Be sure to enter percentages as whole numbers.
Roybal Inc. Schedule of Cash Receipts For August |
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Payments on account: | ||||||
From June credit sales: | ||||||
$ × % | $ | |||||
From July credit sales: | ||||||
$ × % | ||||||
From August credit sales: | ||||||
$ × % | ||||||
Less: August cash discount | ||||||
$ × % | ||||||
Cash receipts | $ |
1.
Roybal Inc. |
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Schedule of Cash Receipts For
July |
|
Payments on account: | |
From May credit sales: | |
310,000 x 23% | 71,300.00 |
From June credit sales: | |
325,000 x 55% | 178,750.00 |
From July credit sales: | |
300,000 x 20% | 60,000.00 |
Less: July cash discount | |
(60,000 x 2%) | - 1,200.00 |
Cash receipts | 308,850.00 |
2.
Roybal Inc. |
|
Schedule of Cash Receipts For
August |
|
Payments on account: | |
From June credit sales: | |
325,000 x 23% | 74,750.00 |
From July credit sales: | |
300,000 x 55% | 165,000.00 |
From August credit sales: | |
375,000 x 20% | 75,000.00 |
Less: August cash discount | |
(75,000 x 2%) | - 1,500.00 |
Cash receipts | 313,250.00 |