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Required: Prepare expected cash collections budget for January, February, March, April and May.

Required: Prepare expected cash collections budget for January, February, March, April and May.

FINANCIAL ACCOUNTING
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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The LaGrange Corporation had the following budgeted sales for the first half of the current year: January February March April May June Cash Sales $50,000 $55,000 $43,000 $38,000 $48,000 $80,000 Credit Sales $150,000 $170,000 $130,000 $123,000 $200,000 $170,000 The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on sales: 50% in month of sale 40% in month following sale 10% in second month following sale The accounts receivable balance on January 1 of the current year was $65,000. Required: Prepare expected cash. collections budget for January, February, March, April and May.
Transcribed Image Text:The LaGrange Corporation had the following budgeted sales for the first half of the current year: January February March April May June Cash Sales $50,000 $55,000 $43,000 $38,000 $48,000 $80,000 Credit Sales $150,000 $170,000 $130,000 $123,000 $200,000 $170,000 The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on sales: 50% in month of sale 40% in month following sale 10% in second month following sale The accounts receivable balance on January 1 of the current year was $65,000. Required: Prepare expected cash. collections budget for January, February, March, April and May.
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