A company’s sales on account for the coming months are as follows: May $120,000 June $126,000 July $132,300 The company finds that typically 70 percent of a month’s credit sales are paid in the month of sale, 20 percent are paid the next month, and 10 percent are paid in the second month after sales. Expected cash receipts in July are budgeted at what amount?
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.
A company’s sales on account for the coming months are as follows:
May $120,000
June $126,000
July $132,300
The company finds that typically 70 percent of a month’s credit sales are paid in the month of
sale, 20 percent are paid the next month, and 10 percent are paid in the second month after sales.
Expected cash receipts in July are budgeted at what amount?
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