Snow Use Inc had the following sales budget for Q1 2022. January sales £160,000: February sales £183,000 March sales £191,000. Collections are historically 60% in the month of the sale, 25% next month and 15% in the third month. Receivables at the end of 2021 were £57,000 - £47,000 of which was uncollected December sales. Calculate:- November 2021 sales December 2021 sales Expected cash collections for January, February and March 2022.
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.
- Snow Use Inc had the following sales budget for Q1 2022. January sales £160,000: February sales £183,000 March sales £191,000. Collections are historically 60% in the month of the sale, 25% next month and 15% in the third month. Receivables at the end of 2021 were £57,000 - £47,000 of which was uncollected December sales. Calculate:-
- November 2021 sales
- December 2021 sales
- Expected cash collections for January, February and March 2022.
Step by step
Solved in 4 steps
