Question

Schedule of Cash Receipts

Del Spencer is the owner and founder of Del Spencer's Men's Clothing Store. Del Spencer's has its own house charge accounts and has found from past experience that 10 percent of its sales are for cash. The remaining 90 percent are on credit. An aging schedule for accounts receivable reveals the following pattern:

15 percent of credit sales are paid in the month of sale.
65 percent of credit sales are paid in the first month following the sale.
14 percent of credit sales are paid in the second month following the sale.
6 percent of credit sales are never collected.

Credit sales that have not been paid until the second month following the sale are considered overdue and are subject to a 3 percent late charge.

Del Spencer's has developed the following sales forecast:

May	$60,000
June	53,000
July	45,000
August	57,000
September	83,000

Required:

Prepare a schedule of cash receipts for August and September. Round all amounts to the nearest dollar.

Del Spencer's Men's Clothing Store
Schedule of Cash Receipts
For the Months of August and September
	August	September
Cash sales	$	$
Received from sales in:
June:
July:
August:
September:
Total cash receipts	$	$

Answer 1

Solution

Del Spencer's Men's Clothing Store
Schedule of Cash Receipts
For the Months of August and September
	August	September
Cash sales	$       5,700.00	$    8,300.00
Received from sales in:
June:	$       6,678.00	$    2,862.00
July:	$     26,325.00	$    5,670.00
August:	$       7,695.00	$   33,345.00
September:		$   11,205.00
Total cash receipts	$     46,398.00	$   61,382.00

Working

	May	June	July	August	September
Sales	$     60,000.00	$        53,000.00	$     45,000.00	$        57,000.00	$ 83,000.00
Cash sales	$       6,000.00	$          5,300.00	$       4,500.00	$          5,700.00	$    8,300.00
Credit sales	$     54,000.00	$        47,700.00	$     40,500.00	$        51,300.00	$ 74,700.00