Required: 1. Demonstrate how financial planning can be used to project cash receipts in January of 20x2 for three different levels January sales. Use the following columnar format. Cash receipts in January 20x2: From December sales on account From January cash sales From January sales on account Totalcanh ronginto $ S Total Sales in January, 20x2 132,000 $ 102,000 $ 7,200 7200 ✔ 0 162,000
Required: 1. Demonstrate how financial planning can be used to project cash receipts in January of 20x2 for three different levels January sales. Use the following columnar format. Cash receipts in January 20x2: From December sales on account From January cash sales From January sales on account Totalcanh ronginto $ S Total Sales in January, 20x2 132,000 $ 102,000 $ 7,200 7200 ✔ 0 162,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required Information
[The following information applies to the questions displayed below.]
Sound Investments, Incorporated, is a large retaller of stereo equipment. The controller is about to prepare
the budget for the first quarter of 20x2. Past experience has indicated that 75 percent of the store's sales
are cash sales. The collection experience for the sales on account is as follows:
85 percent during month of sale
10 percent during month following sale
5 percent uncollectible
The total sales for December 20x1 are expected to be $192,000. The controller feels that sales in January
20x2 could range from $102,000 to $162,000.
Required:
1. Demonstrate how financial planning can be used to project cash receipts in January of 20x2 for three different levels of
January sales. Use the following columnar format.
Cash receipts in January 20x2:
From December sales on account
From January cash sales
From January sales on account
Total cash receipts
$
S
S
Total Sales in January, 20x2
102,000 $ 132,000 $
7,200
7,200
$
0 S
162,000
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F649593ab-9161-4d6b-9fb8-86ec88815ee7%2Fce394927-753e-4bad-9181-9e75cfa21b0e%2Fdfyspia_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required Information
[The following information applies to the questions displayed below.]
Sound Investments, Incorporated, is a large retaller of stereo equipment. The controller is about to prepare
the budget for the first quarter of 20x2. Past experience has indicated that 75 percent of the store's sales
are cash sales. The collection experience for the sales on account is as follows:
85 percent during month of sale
10 percent during month following sale
5 percent uncollectible
The total sales for December 20x1 are expected to be $192,000. The controller feels that sales in January
20x2 could range from $102,000 to $162,000.
Required:
1. Demonstrate how financial planning can be used to project cash receipts in January of 20x2 for three different levels of
January sales. Use the following columnar format.
Cash receipts in January 20x2:
From December sales on account
From January cash sales
From January sales on account
Total cash receipts
$
S
S
Total Sales in January, 20x2
102,000 $ 132,000 $
7,200
7,200
$
0 S
162,000
0
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