Moorcroft Company's budgeted sales and direct materials purchases are as follows: Budgeted Sales Budgeted D.M. Purchases April $299,000 $48,000 May 330,000 49,000 June 398,000 54,000
Moorcroft Company's budgeted sales and direct materials purchases are as follows: Budgeted Sales Budgeted D.M. Purchases April $299,000 $48,000 May 330,000 49,000 June 398,000 54,000
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter13: Budgeting And Standard Costs
Section: Chapter Questions
Problem 13.2.1P: Budgeted income statement and supporting budgets The budget director of Jupiter Helmets Inc., with...
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Moorcroft’s assistant controller suggested that Moorcroft hire a part time collector to encourage customers to pay more promptly and to reduce the amount of uncollectible accounts. Sales are still 40% cash and 60% credit but the assistant controller predicted that this would cause credit sales to be collected 30% in the month of the sale, 50% in the month following sale, and 18% in the second month following sale; 2% are uncollectible.
Prepare a schedule of expected collections from customers for June. How did these changes impact cash collections?
Moorcroft Company Schedule of Expected Collections from Customers |
||||||||
Sales | April | May | June | |||||
April | $ | $ | $ | $ | ||||
May | ||||||||
June | ||||||||
Total Collections | $ | $ | $ |
![Moorcroft Company's budgeted sales and direct materials purchases are as follows:
Budgeted Sales Budgeted D.M. Purchases
April
$299,000
$48,000
May
330,000
49,000
June
398,000
54,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fef058f59-e166-4f4f-a6f7-058a44fda5f2%2F5aecb987-932d-4ddc-924b-8c6eb363ec99%2Fvh34dzj_processed.png&w=3840&q=75)
Transcribed Image Text:Moorcroft Company's budgeted sales and direct materials purchases are as follows:
Budgeted Sales Budgeted D.M. Purchases
April
$299,000
$48,000
May
330,000
49,000
June
398,000
54,000
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![Moorcroft's assistant controller suggested that Moorcroft hire a part time collector to encourage customers to pay more
promptly and to reduce the amount of uncollectible accounts. Sales are still 40% cash and 60% credit but the assistant controller
predicted that this would cause credit sales to be collected 30% in the month of the sale, 50% in the month following sale, and
18% in the second month following sale; 2% are uncollectible.
Prepare a schedule of expected collections from customers for June. How did these changes impact cash collections?
Moorcroft Company
Schedule of Expected Collections from Customers
Sales
April
May
June
$
173420
$
191400
$
i
86710
i
$
173420
299000
330000
398000
$
i
340500
$
230840
99000
32292
202932](https://content.bartleby.com/qna-images/question/ef058f59-e166-4f4f-a6f7-058a44fda5f2/ceabb1ca-1e00-479b-8c4b-95724b80dc52/ykyfm4n_thumbnail.png)
Transcribed Image Text:Moorcroft's assistant controller suggested that Moorcroft hire a part time collector to encourage customers to pay more
promptly and to reduce the amount of uncollectible accounts. Sales are still 40% cash and 60% credit but the assistant controller
predicted that this would cause credit sales to be collected 30% in the month of the sale, 50% in the month following sale, and
18% in the second month following sale; 2% are uncollectible.
Prepare a schedule of expected collections from customers for June. How did these changes impact cash collections?
Moorcroft Company
Schedule of Expected Collections from Customers
Sales
April
May
June
$
173420
$
191400
$
i
86710
i
$
173420
299000
330000
398000
$
i
340500
$
230840
99000
32292
202932
Solution
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