Question

Shadee Corp. expects to sell 630 sun visors in May and 380 in June. Each visor sells for $17. Shadee’s beginning and ending finished goods inventories for May are 80 and 45 units, respectively. Ending finished goods inventory for June will be 50 units.

It expects the following unit sales for the third quarter:      

July	545
August	470
September	440

Sixty percent of Shadee’s sales are cash. Of the credit sales, 52 percent is collected in the month of the sale, 36 percent is collected during the following month, and 12 percent is never collected.

Required:

Calculate Shadee’s total cash receipts for August and September. (Do not round your intermediate calculations. Round your answers to the nearest whole dollar.)

Answer 1

	may	june	july	august	september
Sales units	$        630.00	$     380.00	$     545.00	$     470.00	$     440.00
Sales price	$          17.00	$        17.00	$        17.00	$        17.00	$        17.00
Total sales	$ 10,710.00	$ 6,460.00	$ 9,265.00	$ 7,990.00	$ 7,480.00
cash sales	$    6,426.00	$ 3,876.00	$ 5,559.00	$ 4,794.00	$ 4,488.00
Credit sales	$    4,284.00	$ 2,584.00	$ 3,706.00	$ 3,196.00	$ 2,992.00

Cash receipts budget
	August	September
Cash sales	$          4,794	$        4,488
Credit sales collection from:
July sales	$          1,334
August sales	$          1,662	$        1,151
September sales		$        1,556
Total cash receipts	$         7,790	$        7,194