In 2021, Chatsworth Company expects sales of $40,000 in July, $50,000 in August, and $30,000 in September. Chatsworth's experience is that 40% of sales are cash, and the remainder is on account. Accounts receivable are paid: 70% in the month of sale, and 25% in the following month. How much of July sales are deemed to be uncollectible? 2,500 1,000 1,800 3,000 1,200

In 2021, Chatsworth Company expects sales of $40,000 in July, $50,000 in August, and $30,000 in September. Chatsworth's experience is that 40% of sales are cash, and the remainder is on account. Accounts receivable are paid: 70% in the month of sale, and 25% in the following month. How much of July sales are deemed to be uncollectible? 2,500 1,000 1,800 3,000 1,200

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

OfficeMart Inc. has “cash and carry” customers and credit customers. OfficeMart estimates that 30% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 40% pay their accounts in the month of sale, while the remaining 60% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows: Month Projected sales April $56,000 May 65,000 June 72,000 The Accounts Receivable balance on March 30 was $35,000. Prepare a schedule of cash collections from sales for April, May, and June.
Jamaica Co’s sales forecast for the first five months of 2018 are as follows: January February March April May $ 32,000 $ 36,000 $ 48,000 $ 46,000 $ 55,000 Additional information provided is as follows: (i) Sales for November and December of the previous year were $40,000 and $45,000 respectively. (ii) Sixty percent of sales will be for cash; 30% will be collected in the first month following the sale; and the remaining 10% will be collected in the second month following the sale. (iii) Raw material purchases are settled a month after purchase. Each month’s purchases is shown below: December January February March April $22,400 $25,200 $33,600 $32,200 $38,500 (iv) Wages total $4,200 monthly. (v) Other expenses are $1,800 in January but is expected to increase by $550 each month; (vi) Equipment costing $15,000 will be ordered in January. A…
The Milton Company currently purchases an average of $18,000 per day in raw materials on credit terms of "net 25." The company expects sales to increase substantially next year and anticipates that its raw material purchases will increase to an average of $22,000 per day. Milton feels that it may need to finance part of this sales expansion by stretching accounts payable. Round your answers to the nearest dollar. Assuming that Milton currently waits until the end of the credit period to pay its raw material suppliers, what is its current level of trade credit? $ If Milton stretches its accounts payable an extra 5 days beyond the due date next year, how much additional short-term funds (that is, trade credit) will be generated? $
O'Connor Corporation had December Sales of $30,000; Anticipated Sales during January are $40,000; February Sales are projected at $37,500; 40% of Sales are Cash Sales; The remainder are on account; Sales on account are expected to be collected 50% in the month of Sale; 45% in the month following the month of Sale; 5% ultimately prove uncollectible. Required: How much are anticipated Cash collections during the month of February?
Thomas & Cooke Corporation has the following sales forecasts for the first three months of the current year: Month Sales January $39,000 February 26,000 March 45,000 85% of sales are collected in the month of the sale and the remainder is collected in the following month. Accounts receivable balance (January 1) $25,800 Cash balance (January 1) 25,000 Minimum cash balance needed 22,000 What is the cash balance at the end of January, assuming that cash is received only from customers and that $50,000 is paid out during January?
J.TOY Inc., was organized on August 1 of the current year. Projected sales for the ا ی و ن ن و ر می و ی و و و و و ی next three months are as follows: -August : $120,000 -September : $200,000 -October : $230,000 The J.TOY expects to sell 40% of its merchandise for cash. Of the sales on account, 25% are expected to be collected in the month of the sale and the remainder in the following month. Prepare a schedule indicating total cash collections for August, September, and October.
Ind
A company has expected sales for January through April of $9,800, 59, 500, $13, 800, and $9,500, respectively. Assume each month has 30 days and the accounts receivable period is 36 days. How much does the company expect to collect in the month of May?
Vikrambhai
Halifax Shoes has 39% of its sales in cash and the remainder on credit. Of the credit sales, 65% is collected in the month of sale, 25% is collected the month after the sale, and 5% is collected the second month after the sale. How much cash will be collected in August if sales are estimated as $61,125 in June, $88,627 in July, and $70,376 in August? Round to the nearest penny, two decimal places.
Halifax Shoes has 30% of its sales in cash and the remainder on credit. Of the credit sales, 65% is collected in the month of sale, 25% is collected the month after the sale, and 5% is collected the second month after the sale. How much cash will be collected in August if sales are estimated as $73,000 in June, $63,000 in July, and $95,000 in August?
Assume receivables of $20,000 at the start of the January are all collected during the month; if sales for January and February are $400,000 and $300,000 respectively; the company typically receives payment from 20% of its customers within the same month, 60% the following month, and the remaining 20% by the end of the second following month, how much would accounts receivable be at the end of February?