Question

In: Accounting

ABC Company has the following sales budget for the last six months of 2020:

 

Note: Not all sales are always collected. Remember Bad Debt Expense. So don’t worry if the problems do not add up to 100%.  

1. ABC Company has the following sales budget for the last six months of 2020:

                  July                             $9,000                       

                  August                      $8,000                       

                  September                 $11,000

                  October                      $9,000                       

Historically, the cash collection of sales has been as follows:

                                    35% of sales collected in the month of sale,

                                    45% of sales collected in the month following the sale,

                                    20% of sales collected in the second month following the sale.

What are expected cash collections for September? For October?

  1. Jason D’s sales for the next five months are as follows:

February                   $175,000

March                        $160,000

April                           $145,000

May                            $135,000

June                            $130,000

Collection history for the company indicates that 50% of sales are collected in the month of the sale, 38% is collected in the following month, and 12% of sales are uncollectible.

How much are total budgeted cash receipts for April? For May? For June?

  1. XYZ’s budgeted sales for the next three months are as follows:

February $130,000

March                        $170,000

April                           $200,000

Collection history for the company indicates that 60% of sales are collected in the month of the sale, 36% is collected in the following month, and 4% of sales are uncollectible. How much are budgeted cash receipts for April?

Solutions

Expert Solution

Given,

1. ABC Company has the following sales budget for the last six months of 2020:

                  July                           $9,000                       

                  August                      $8,000                       

                  September                $11,000

                  October                     $9,000                       

Historically, the cash collection of sales has been as follows:

                                    35% of sales collected in the month of sale,

                                    45% of sales collected in the month following the sale,

                                    20% of sales collected in the second month following the sale.

Expected cash collected for,

September    =$9250

October          =$9700

Given,

1. Jason D’s sales for the next five months are as follows:

February                   $175,000

March                        $160,000

April                           $145,000

May                            $135,000

June                            $130,000

Collection history for the company indicates that 50% of sales are collected in the month of the sale, 38% is collected in the following month, and 12% of sales are uncollectible.

Total budgeted cash receipts of

April    =$133300

May     =$122600

June   =$116300

Given,

1. XYZ’s budgeted sales for the next three months are as follows:

February                      $130,000

March                        $170,000

April                           $200,000

Collection history for the company indicates that 60% of sales are collected in the month of the sale, 36% is collected in the following month, and 4% of sales are uncollectible.

Budgeted cash receipts of April =$181200

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Copper Corporation has the following sales budget for the last six months of 2016:
Copper Corporation has the following sales budget for the last six months of 2016:July$200,000October$180,000August160,000November200,000September220,000December188,000Historically, the cash collection of sales has been as follows:65 percent of sales collected in month of sale,25 percent of sales collected in month following sale,8 percent of sales collected in second month following sale, and2 percent of sales is uncollectable.Cash collections for October are$117,000.$174,000.$184,800.$199,000.$176,400.
Suppose a company has the following sales for the last six months (January – June): Month...
Suppose a company has the following sales for the last six months (January – June): Month Period Sales January 1 16 February 2 25 March 3 20 April 4 20 May 5 31 June 6 35 July 7 26 August 8 (a) Use exponential smoothing (a= 0.10) to forecast the sales for August (to 2 decimals). What is the value? Compute the MSE for the exponential smoothing method from the above question (to 2 decimals). Use a 2-period moving average...
ABC Company has budgeted sales for the next six months as follows: Budgeted Sales in Units...
ABC Company has budgeted sales for the next six months as follows: Budgeted Sales in Units March 12,000 units April 24,000 units May 35,000 units June 13,000 units July 43,000 units August 69,000 units ABC Company sells its inventory to customers for $25 per unit. 30% of the company's sales are cash sales and the other 70% of sales are made on account. The sales on account are collected in the pattern: 35% collected in the month of sale 26%...
ABC Company has budgeted sales for the next six months as follows: Budgeted Sales in Units...
ABC Company has budgeted sales for the next six months as follows: Budgeted Sales in Units March 19,000 units April 23,000 units May 34,000 units June 17,000 units July 48,000 units August 69,000 units ABC Company sells its inventory to customers for $16 per unit. 30% of the company's sales are cash sales and the other 70% of sales are made on account. The sales on account are collected in the pattern: 35% collected in the month of sale 26%...
Elias Company has prepared a budget for the first six months of 2020. Monthly budgets for...
Elias Company has prepared a budget for the first six months of 2020. Monthly budgets for revenues are provided at left. Experience indicates that Elias will collect 75% of sales in the month of sale, 15% in the month following the sale, and 7.5% in the second month after the sale. The remaining 2.5% of sales are expected to be uncollectible. Prepare a cash collections budget for Elias for the months of March, April, and May 2020. Show your work....
Shown below are the budgeted sales for ABC Company for the next six months: Sales for...
Shown below are the budgeted sales for ABC Company for the next six months: Sales for Cash Sales on Account January $18,000 $ 95,000 February $15,000 $130,000 March $24,000 $ 70,000 April $26,000 $120,000 May $19,000 $ 90,000 June $14,000 $100,000 On average, 45% of the sales on account are collected in the month of sale, 30% are collected in the month following sale, 15% are collected in the second month following sale, and the remaining 10% is collected three...
Shown below are the budgeted sales for ABC Company for the next six months: Sales for...
Shown below are the budgeted sales for ABC Company for the next six months: Sales for Cash Sales on Account January $15,000 $110,000 February $18,000 $125,000 March $26,000 $119,000 April $24,000 $140,000 May $14,000 $ 88,000 June $18,000 $137,000 On average, 25% of the sales on account are collected in the month of sale, 30% are collected in the month following sale, 35% are collected in the second month following sale, and the remaining 10% is collected three months after...
Shown below are the budgeted sales for ABC Company for the next six months: Sales for...
Shown below are the budgeted sales for ABC Company for the next six months: Sales for Cash Sales on Account January $15,000 $ 70,000 February $18,000 $ 80,000 March $14,000 $160,000 April $26,000 $120,000 May $18,000 $170,000 June $24,000 $105,000 On average, 35% of the sales on account are collected in the month of sale, 40% are collected in the month following sale, 10% are collected in the second month following sale, and the remaining 15% is collected three months...
Based on an analysis of the last six months’ sales, your boss notices that sales of...
Based on an analysis of the last six months’ sales, your boss notices that sales of beef products are declining in your chain’s restaurants. As beef entrée sales decline, so do profits. Fearing beef sales have declined due to several newspaper stories reporting E.coli contamination discovered at area grocery stores, he suggests a survey of area restaurants to see if the situation is pervasive. What do you think of this research suggestion? How, if at all, could you improve on...
Simpson Glove Company has made the following sales projections for the next six months. All sales...
Simpson Glove Company has made the following sales projections for the next six months. All sales are credit sales. March $41,000 June $47,000 April 50,000 July 58,000 May 32,000 August 62,000 Sales in January and February were $41,000 and $39,000, respectively. Experience has shown that of total sales receipts 10 percent are uncollectible, 40 percent are collected in the month of sale, 30 percent are collected in the following month, and 20 percent are collected two months after sale. Prepare...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT