A company is working on their budgets for the year 2021. The table below has a few of their expectations for 2021. Accounts Receivable on January 1 Sales in January Sales in February Sales in March Sales in April $35,221 $50,735 $54,654 $58,517 $59,497 Historically, this company's collection pattern for sales has been 16% as cash sales and 84% on account. The sales on account get collected 75% one month following the sale and the remainder two months following the sale. The Accounts Receivable on January 1 is the result of credit sales in December 2020 and thus is expected to be collected according to the sales on account pattern (75%/25%). How much should this company expect in Cash Collections for the month of January? (round to the nearest whole dollar/input code 0)

A company is working on their budgets for the year 2021. The table below has a few of their expectations for 2021. Accounts Receivable on January 1 Sales in January Sales in February Sales in March Sales in April $35,221 $50,735 $54,654 $58,517 $59,497 Historically, this company's collection pattern for sales has been 16% as cash sales and 84% on account. The sales on account get collected 75% one month following the sale and the remainder two months following the sale. The Accounts Receivable on January 1 is the result of credit sales in December 2020 and thus is expected to be collected according to the sales on account pattern (75%/25%). How much should this company expect in Cash Collections for the month of January? (round to the nearest whole dollar/input code 0)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Master Budget

A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.

Sales Budget and Selling

A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.

Question

A company is working on their budgets for the year 2021. The table below has a few of their
expectations for 2021.
Accounts Receivable on January 1
Sales in January
Sales in February
Sales in March
Sales in April
$35,221
$50,735
$54,654
$58,517
$59,497
Historically, this company's collection pattern for sales has been 16% as cash sales and 84% on
account. The sales on account get collected 75% one month following the sale and the remainder
two months following the sale.
The Accounts Receivable on January 1 is the result of credit sales in December 2020 and thus is
expected to be collected according to the sales on account pattern (75%/25%).
How much should this company expect in Cash Collections for the month of January? (round to
the nearest whole dollar/input code 0)
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