Adams Pointers Corporation expects to begin operations on January 1, year 1; it will operate as a specialty sales company that sells laser pointers over the Internet. Adams expects sales in January year 1 to total $350,000 and to increase 15 percent per month in February and March. All sales are on account. Adams expects to collect 66 percent of accounts receivable in the month of sale, 25 percent in the month following the sale, and 9 percent in the second month following the sale. Required a. Prepare a sales budget for the first quarter of year 1. b. Determine the amount of sales revenue Adams will report on the year 1 first quarterly pro forma income statement. c. Prepare a cash receipts schedule for the first quarter of year 1. d. Determine the amount of accounts receivable as of March 31, year 1. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare a cash receipts schedule for the first quarter of year 1. Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar. February March Schedule of Cash Receipts Receipts from January sales Receipts from February sales Receipts from March sales Total January $ 231,000 $ 231,000 $ Required B 0 $ Required D >
Adams Pointers Corporation expects to begin operations on January 1, year 1; it will operate as a specialty sales company that sells laser pointers over the Internet. Adams expects sales in January year 1 to total $350,000 and to increase 15 percent per month in February and March. All sales are on account. Adams expects to collect 66 percent of accounts receivable in the month of sale, 25 percent in the month following the sale, and 9 percent in the second month following the sale. Required a. Prepare a sales budget for the first quarter of year 1. b. Determine the amount of sales revenue Adams will report on the year 1 first quarterly pro forma income statement. c. Prepare a cash receipts schedule for the first quarter of year 1. d. Determine the amount of accounts receivable as of March 31, year 1. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare a cash receipts schedule for the first quarter of year 1. Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar. February March Schedule of Cash Receipts Receipts from January sales Receipts from February sales Receipts from March sales Total January $ 231,000 $ 231,000 $ Required B 0 $ Required D >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Step 1: Define accounts receivable
VIEWStep 2: a. Computation of sales budget for the first quarter of year 1
VIEWStep 3: b. Computation of sales revenue that will report on year 1
VIEWStep 4: c. Preparation of cash schedule for the first quarter of year 1
VIEWStep 5: d. Determining the amount of accounts receivable
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