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In: Accounting

limerick, Inc: has budgeted total sales for January, February, and March of $800,000, $900,000, and $950,000...

limerick, Inc: has budgeted total sales for January, February, and March of $800,000, $900,000, and $950,000 respectively. Cash sales are normally 25% of total sales. Of the credit sales, 40% are collected in the same month as the sale, and 60% are collected during the first month after the sale. Compute the amount of cash received from sales during the month of February.




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Expert Solution

Jan Feb March
Sales $      800,000 $      900,000 $      950,000
Cash sales $      200,000 $      225,000 $      237,500
Credit Sales $      600,000 $      675,000 $      712,500
Collection of credit sales
Jan Feb March
Jan $      240,000 $      360,000
Feb $      270,000 $      405,000
March $      285,000
Total Sales collected $      240,000 $      630,000 $      690,000
amount of cash received from sales during the month of February ($225000+630000) $      855,000


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