Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below. Total $ 1,070,000 April $ 330,000 May $ 530,000 June $ 210,000 Budgeted sales (all on account) The company estimates 25% of a month's sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 15% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $260,000, and March sales totaled $290,000. 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?
Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below. Total $ 1,070,000 April $ 330,000 May $ 530,000 June $ 210,000 Budgeted sales (all on account) The company estimates 25% of a month's sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 15% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $260,000, and March sales totaled $290,000. 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?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
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Transcribed Image Text:Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below.
Total
$ 1,070,000
Show Transcribed Text
Budgeted sales (all on account)
The company estimates 25% of a month's sales are collected in the month of sale, another 60% are collected in the month following
sale, and the remaining 15% are collected in the second month following sale. Bad debts are negligible and can be ignored. February
sales totaled $260,000, and March sales totaled $290,000.
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?
April
$ 330,000
Required 1 Required 2
February sales
March sales
April sales
May sales
June sales
Total cash collections
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.
174,000
82,500
$ 256,500 $
May
$ 530,000
J
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
198,000
132,500
330,500 $
Ĉ
June
$
June
$ 210,000
318,000
52,500
370,500 $
Total
0
174,000
280,500
450,500
52,500
957,500
Required 2 >
Transcribed Image Text: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
What is the accounts receivable balance on June 30th?
Total accounts receivable at June 30
< Required 1
Required 2 >
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