In: Accounting
Shadee Corp. expects to sell 650 sun visors in May and 340 in June. Each visor sells for $10. Shadee’s beginning and ending finished goods inventories for May are 75 and 50 units, respectively. Ending finished goods inventory for June will be 65 units.
It expects the following unit sales for the third quarter:
July 500
August 470
September 460
Sixty percent of Shadee's sales are cash. Of the credit sales, 52 percent is collected in the month of the sale, 37 percent is collected during the following month, and 11 percent is never collected.
Required:
Calculate Shadee's total cash receipts for August and September. (Do not round your intermediate calculations. Round your answers to the nearest whole dollar.)
(1) in august:
cash receipts for month of August = (470 x $10) x 52% = $2444
cash receipts for month of July = (500 x $10) x 37% = $1850
total cash receipts = $2444 + $1850 = $4294
(2) in September:
cash receipts for month of September = (460 x $10) x 52% = $2392
cash receipts for month of August = (470 x $10) x 37% = $1739
total cash receipts = $2392 + $1739 = $4131