Question
In: Accounting
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak sales occur in May of each year, as shown in the company’s sales budget for the second quarter given below:
|
April |
May |
June |
Total |
|
|
Budgeted sales (all on account) |
$500,000 |
$700,000 |
$240,000 |
$1,440,000 |
From past experience, the company has learned that 20% of a month’s sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 20% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $430,000, and March sales totaled $460,000.
Required:
1. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter.
2. What is the accounts receivable balance on June 30th?
- Required 1
Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter.
|
|||||||||||||||||||||||||||||||||||||||||
- Required 2
What is the accounts receivable balance on June 30th?
|
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Solutions
Expert Solution
Requirement 1
| April | May | June | Total | |
| February Sales | $ 86,000.00 | $ 86,000.00 | ||
| March Sales | $ 2,76,000.00 | $ 92,000.00 | $ 3,68,000.00 | |
| April Sales | $ 1,00,000.00 | $ 3,00,000.00 | $ 1,00,000.00 | $ 5,00,000.00 |
| May Sales | $ 1,40,000.00 | $ 4,20,000.00 | $ 5,60,000.00 | |
| June Sales | $ 48,000.00 | $ 48,000.00 | ||
| Total Cash Collection | $ 4,62,000.00 | $ 5,32,000.00 | $ 5,68,000.00 | $ 15,62,000.00 |
Working
| April | May | June | ||
| February Sales | =430000*20% | |||
| March Sales | =460000*60% | =460000*20% | ||
| April Sales | =500000*20% | =500000*60% | =500000*20% | |
| May Sales | =700000*20% | =700000*60% | ||
| June Sales | =240000*20% |
Requirement 2
| Accounts Receivables Balance | ||
| Balance of may sales | (20% of sale) | $ 1,40,000.00 |
| Balance of June Sale | (80% of sale) | $ 1,92,000.00 |
| Total balance of Receivables | $ 3,32,000.00 | |
ekkarill92 answered 1 month agoRelated Solutions
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$450,000
$650,000
$250,000
$1,350,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below: April May June Total Budgeted sales (all on account)
$410,000 $610,000 $210,000 $1,230,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$330,000
$530,000
$210,000
$1,070,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$390,000
$590,000
$230,000
$1,210,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below: April May June Total Budgeted sales (all on account)
$470,000 $670,000 $230,000 $1,370,000 From past experience, the
company has learned that 25% of a month’s sales are collected in
the month of sale, another 65% are collected in the month following
sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$460,000
$660,000
$210,000
$1,330,000
From past experience, the company has learned that 20% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$330,000
$530,000
$210,000
$1,070,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$390,000
$590,000
$230,000
$1,210,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$310,000
$510,000
$160,000
$980,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
Silver Company makes a product that is very popular as a Mother’s Day gift. Thus, peak...
Silver Company makes a product that is very popular as a
Mother’s Day gift. Thus, peak sales occur in May of each year, as
shown in the company’s sales budget for the second quarter given
below:
April
May
June
Total
Budgeted sales (all on account)
$430,000
$630,000
$200,000
$1,260,000
From past experience, the company has learned that 25% of a
month’s sales are collected in the month of sale, another 60% are
collected in the month following sale, and the...
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