and Company is a legal services firm. All sales of legal services are billed to the client (there are no cash sales). Kailua expects that, on average, 20% will be paid the month of billing, 50% will be paid in the month following billing, and 25% will be paid in the second month following billing. For the next 5 months, the following sales billings are expected: May June July August September Required: $84,000 100,800 77,000 87,000 88,000 Prepare a schedule showing the cash expected payments on accounts receivable in August and in September. If an amount box does not require an entry, leave it blank or enter "0". Be sure to enter percentages as whole numbers
and Company is a legal services firm. All sales of legal services are billed to the client (there are no cash sales). Kailua expects that, on average, 20% will be paid the month of billing, 50% will be paid in the month following billing, and 25% will be paid in the second month following billing. For the next 5 months, the following sales billings are expected: May June July August September Required: $84,000 100,800 77,000 87,000 88,000 Prepare a schedule showing the cash expected payments on accounts receivable in August and in September. If an amount box does not require an entry, leave it blank or enter "0". Be sure to enter percentages as whole numbers
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Preparing a Schedule of Cash Collections on Accounts Receivable
Kailua and Company is a legal services firm. All sales of legal services are billed to the client (there are no cash sales). Kailua expects that, on average, 20% will be paid in the month of billing, 50% will be paid
following billing, and 25% will be paid in the second month following billing. For the next 5 months, the following sales billings are expected:
May
June
July
August
September
Required:
June:
$
July:
$
Prepare a schedule showing the cash expected in payments on accounts receivable in August and in September. If an amount box does not require an entry, leave it blank or enter "0". Be sure to enter percentages as
whole numbers.
August:
$84,000
X
100,800
77,000
87,000
88,000
%
%
%
Kailua and Company Schedule
August
September
the month
0
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Step 1: Kailua & Company's cash collections for the months of August and September are being prepared.
VIEWStep 2: Cash collection calculation
VIEWStep 3: cash collected during the billing month
VIEWStep 4: cash collection for the following month
VIEWStep 5: amounts for August and September
VIEWStep 6: Schedule of Cash Collections
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