Question

Cash Receipts
The sales budget for Perrier Inc. is forecasted as follows:

Month	Sales Revenue
May	$100,000
June	180,000
July	200,000
August	140,000

To prepare a cash budget, the company must determine the budgeted cash collections from sales. Historically, the following trend has been established regarding cash collection of sales:

60 percent in the month of sale.

20 percent in the month following sale.

15 percent in the second month following sale.

5 percent uncollectible.

The company gives a 1 percent cash discount for payments made by customers during the month of sale. The accounts receivable balance on April 30 is $29,000, of which $8,000 represents uncollected March sales and $21,000 represents uncollected April sales. Prepare a schedule of budgeted cash collections from sales for May, June, and July. Include a three-month summary of estimated cash collections.

Perrier, Inc. Schedule of Budgeted Cash Collections Quarterly by Months
	May	June	July	Total
Total Cash receipts:	$Answer	$Answer	$Answer	$Answer

Answer 1

1)	Caclualtion of Cash collection From the month of May 201y to July 2017
	Calcualtion of Monthly Collection from Sales
		May-17	Jun-17	Jul-17	Aug-17
	Sales	$       1,00,000.00	$       1,80,000.00	$    2,00,000.00	$    1,40,000.00
	60% in the month of Sales	$           60,000.00	$       1,08,000.00	$    1,20,000.00	$       84,000.00
	Less : Cash Discount 1%	$               -600.00	$            -1,080.00	$        -1,200.00	$            -840.00
	20 % in the month of Following Sale		$           20,000.00	$       36,000.00	$       40,000.00
	15% in the second month following sale			$       15,000.00	$       27,000.00
	5% is uncollectable			$                       -	$                       -
	Total Cash Receipts	$           59,400.00	$       1,26,920.00	$    1,69,800.00	$    1,50,160.00	$                          -
	Total Cash Receipts	May-17	Jun-17	Jul-17	Total
		$           59,400.00	$       1,26,920.00	$    1,69,800.00	$    3,56,120.00