Silver Company makes a product that is very popular as a Mother's Day gift. Thus, peak sales occur in May of each year, as shown in the company's sales budget for the second quarter given below: Budgeted sales (all on account) April May June Total $ 400,000 $ 600,000 $ 190,000 $ 1,190,000 From past experience, the company has learned that 30% of a month's sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $330,000, and March sales totaled $360,000. Required: 1. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. 2. What is the accounts receivable balance on June 30th? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. Schedule of Expected Cash Collections April May June Total February sales $ 49,500 $ March sales 247,000 49,500 247,000 April sales 12,000 12,000 May sales 0 June sales 0 Total cash collections $ 308,500 $ 0 $ 308,500
Silver Company makes a product that is very popular as a Mother's Day gift. Thus, peak sales occur in May of each year, as shown in the company's sales budget for the second quarter given below: Budgeted sales (all on account) April May June Total $ 400,000 $ 600,000 $ 190,000 $ 1,190,000 From past experience, the company has learned that 30% of a month's sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $330,000, and March sales totaled $360,000. Required: 1. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. 2. What is the accounts receivable balance on June 30th? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. Schedule of Expected Cash Collections April May June Total February sales $ 49,500 $ March sales 247,000 49,500 247,000 April sales 12,000 12,000 May sales 0 June sales 0 Total cash collections $ 308,500 $ 0 $ 308,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Denger
Transcribed Image Text:Silver Company makes a product that is very popular as a Mother's Day gift. Thus, peak sales occur in May of each year, as shown in
the company's sales budget for the second quarter given below:
Budgeted sales (all on account)
April
May
June
Total
$ 400,000 $ 600,000 $ 190,000 $ 1,190,000
From past experience, the company has learned that 30% of a month's sales are collected in the month of sale, another 60% are
collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are
negligible and can be ignored. February sales totaled $330,000, and March sales totaled $360,000.
Required:
1. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter.
2. What is the accounts receivable balance on June 30th?
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter.
Schedule of Expected Cash Collections
April
May
June
Total
February sales
$
49,500
$
March sales
247,000
49,500
247,000
April sales
12,000
12,000
May sales
0
June sales
0
Total cash collections
$
308,500
$
0
$
308,500
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