Cash Receipts Budget and Accounts Receivable Aging ScheduleShalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted thefollowing sales:Quarter 1$4,800,000Quarter 25,340,000Quarter 33,960,000Quarter 48,300,000In Shalimar's experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collectedin the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected inthe second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter ofthe current year are $5,700,000 and for the fourth quarter of the current year are $7,500,000.Required:1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarterof next year.QuarterCash SalesCredit Sales3, current year4, current year1, next year2, next year3, next year4, next year 2. Construct a cash receipts budget for Shalimar Company for each quarter of the next vear, showing the cash sales and the cash collections from credit sales. If an amount iszero, enter "0".Shalimar CompanyCash Receipts BudgetFor the Coming YearQuarter 1 Quarter 2 Quarter 3 Quarter 4Cash salesReceived on account from:Quarter 3, current yearQuarter 4, current yearQuarter 1, next yearQuarter 2, next yearQuarter 3, next yearQuarter 4, next yearTotal cash receipts3. What if the recession led Shalimar's top management to assume that in the next year 10 percent of credit sales would never be.collected? The expected payment percentagesin the quarter of salé and the quarter after sale are assumed to be the same. Hovw would that affect cash received in each quarter? Construct a revised cash budget using the newassumption.Shalimar CompanyCash Receipts BudgetFor the Coming YearQuarter 1 Quarter 2 Quarter 3 Quarter 4Cash salesReceived on account from:Quarter 4, current yearQuarter 1, next yearQuarter 2, next yearQuarter 3, next yearQuarter 4, next yearTotal cash receipts10 00 0

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Cash Receipts Budget and Accounts Receivable Aging Schedule Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the following sales: Quarter 1 $4,800,000 Quarter 2 5,340,000 Quarter 3 3,960,000 Quarter 4 8,300,000 In Shalimar's experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are $5,700,000 and for the fourth quarter of the current year are $7,500,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. Quarter Cash Sales Credit Sales 3, current year 4, current year 1, next year 2, next year 3, next year 4, next year

Cash Receipts Budget and Accounts Receivable Aging Schedule Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the following sales: Quarter 1 $4,800,000 Quarter 2 5,340,000 Quarter 3 3,960,000 Quarter 4 8,300,000 In Shalimar's experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are $5,700,000 and for the fourth quarter of the current year are $7,500,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. Quarter Cash Sales Credit Sales 3, current year 4, current year 1, next year 2, next year 3, next year 4, next year

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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