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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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St. Germaine Corporation has found that 80% of its sales in any given month are credit sales, while the remainder are cash sales. Of the credit sales, St. Germaine Corporation has experienced the following collection pattern: 25% received in the month of the sale 50% received in the month after the sale 18% received two months after the sale 7% of the credit sales are never received Cash sales Collections on credit sales: 25% Month of sale 50% Month after 18% Two months after Total cash collections 1...1 Cash Collections Budget For the Months of January through March January November sales for last year were $105,000, while December sales were $115,000. Projected sales for the next three months are as follows: January sales February sales March sales $ $ $ 160,000 120,000 170,000 Requirement Prepare a cash collections budget for the first quarter, with a column for each month and for the quarter. (Round your answers to the nearest whole dollar.)
Transcribed Image Text:St. Germaine Corporation has found that 80% of its sales in any given month are credit sales, while the remainder are cash sales. Of the credit sales, St. Germaine Corporation has experienced the following collection pattern: 25% received in the month of the sale 50% received in the month after the sale 18% received two months after the sale 7% of the credit sales are never received Cash sales Collections on credit sales: 25% Month of sale 50% Month after 18% Two months after Total cash collections 1...1 Cash Collections Budget For the Months of January through March January November sales for last year were $105,000, while December sales were $115,000. Projected sales for the next three months are as follows: January sales February sales March sales $ $ $ 160,000 120,000 170,000 Requirement Prepare a cash collections budget for the first quarter, with a column for each month and for the quarter. (Round your answers to the nearest whole dollar.)
A 16 17 Particulars 18 Total sales (100%) 19 Cash sales (20% of sales) 20 Credit sales (80% of sales) 21 22 23 24 Particulars 25 Cash sales 26 Collections on credit sales 27 25% Month of sale 28 29 30 Total cash collections B с Sales: November December $1,05,000.00 $1,15,000.00 $ 21,000.00 $ 23,000.00 $ 84,000.00 $ 92,000.00 Cash collection budget For the Months of January through March January D January $ 1,60,000.00 $ $ 32,000.00 $ $1,28,000.00 $ February March $ 32,000.00 $ 24,000.00 $ 34,000.00 $ 32,000.00 $ 24,000.00 $ 34,000.00 $ 50% Month after 46,000.00 $ 64,000.00 $ 48,000.00 18% Two months after $ 15,120.00 $ 16,560.00 $ 23,040.00 $ 1,25,120.00 $1,28,560.00 $1,39,040.00 E February F LL March 1,20,000.00 $ 1,70,000.00 24,000.00 $ 34,000.00 96,000.00 $1,36,000.00
Transcribed Image Text:A 16 17 Particulars 18 Total sales (100%) 19 Cash sales (20% of sales) 20 Credit sales (80% of sales) 21 22 23 24 Particulars 25 Cash sales 26 Collections on credit sales 27 25% Month of sale 28 29 30 Total cash collections B с Sales: November December $1,05,000.00 $1,15,000.00 $ 21,000.00 $ 23,000.00 $ 84,000.00 $ 92,000.00 Cash collection budget For the Months of January through March January D January $ 1,60,000.00 $ $ 32,000.00 $ $1,28,000.00 $ February March $ 32,000.00 $ 24,000.00 $ 34,000.00 $ 32,000.00 $ 24,000.00 $ 34,000.00 $ 50% Month after 46,000.00 $ 64,000.00 $ 48,000.00 18% Two months after $ 15,120.00 $ 16,560.00 $ 23,040.00 $ 1,25,120.00 $1,28,560.00 $1,39,040.00 E February F LL March 1,20,000.00 $ 1,70,000.00 24,000.00 $ 34,000.00 96,000.00 $1,36,000.00
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