Fur Family Inc., a pet wholesale supplier, was organized on May 1. Projected sales for each of the first three months of operations are as follows: May $270,000 June 300,000 July 440,000 All sales are on account. Of sales on account, 50% are expected to be collected in the month of the sale, 46% in the first month following the sale, and the remainder in the second month following the sale. Prepare a schedule indicating cash collections from sales for May, June, and July.
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.
Fur Family Inc., a pet wholesale supplier, was organized on May 1. Projected sales for each of the first three months of operations are as follows:
| May | $270,000 |
| June | 300,000 |
| July | 440,000 |
All sales are on account. Of sales on account, 50% are expected to be collected in the month of the sale, 46% in the first month following the sale, and the remainder in the second month following the sale.
Prepare a schedule indicating cash collections from sales for May, June, and July.
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