Question

3) 60 % percent of Putnam Corporation's sales are collected in the month of sale, 30% in the month following sale, and 10% in the second month following sale. The following are budgeted sales data for the company:

	January	February	March	April
Budgeted sales	$200,000	$300,000	$350,000	$250,000

Total budgeted cash collections in April would be:

A) $175,000

B) $150,000

C) $285,000

D) $255,000

4) Half of Curry Corporation's sales are on account (credit)- the other half is cash on delivery. Sixty percent of the credit sales are collected in the month of sale, 30% in the month following sale, and 10% in the second month following sale. The following are budgeted sales data for the company:

	January				February				March				April
Total sales (cash and credit)	$	700,000		$		500,000		$		400,000	$	600,000

Cash receipts in April are expected to be:

A) $565,000

B) $265,000

C) $540,000

D) none of the above

5) Bo Jackson Corporation produces and sells one product. The budgeted selling price per unit is $105. Budgeted unit sales for July, August, September, and October are 7,500, 7,500, 12,800, and 15,300 units, respectively. All sales are on credit. Regarding credit sales, 40% are collected in the month of the sale and 60% in the following month.

The budgeted accounts receivable balance at the end of August is closest to:

A) $525,000

B) $315,000

C) $472,500

D) $787,500

Answer 1