The table below is Rebecca Minkoff's budgeted sales: April May June July August $452,000 $467,000 $ 498,000 $520,000 $507,000 Rebecca Minkoff estimates that sales are 30% in credit and the remainder in cash. Also, Rebecca Minkoff estimates that 50% of credit sales are collected in the month of sale, 35% of credit sales are collected in the month following the sale, and 6% of credit sales are collected in the second month following the sale. Three requirements: a. Compute the amount of cash that Rebecca Minkoff will collect in June. b. Compute the amount of cash that Rebecca Minkoff will collect in July. c. Compute the amount of cash that Rebecca Minkoff will collect in August. a. Compute the amount of cash that Rebecca Minkoff will collect in June (Do not round intermediate calculations.) Cash Receipts Submit

The table below is Rebecca Minkoff's budgeted sales: April May June July August $452,000 $467,000 $ 498,000 $520,000 $507,000 Rebecca Minkoff estimates that sales are 30% in credit and the remainder in cash. Also, Rebecca Minkoff estimates that 50% of credit sales are collected in the month of sale, 35% of credit sales are collected in the month following the sale, and 6% of credit sales are collected in the second month following the sale. Three requirements: a. Compute the amount of cash that Rebecca Minkoff will collect in June. b. Compute the amount of cash that Rebecca Minkoff will collect in July. c. Compute the amount of cash that Rebecca Minkoff will collect in August. a. Compute the amount of cash that Rebecca Minkoff will collect in June (Do not round intermediate calculations.) Cash Receipts Submit

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter4: Financial Planning And Forecasting

Section: Chapter Questions

Problem 5P

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A companys sales for the coming months are as follows: About 20 percent of sales are cash sales, and the remainder are credit sales. The company finds that typically 10 percent of a months credit sales are paid in the month of sale, 70 percent are paid the next month, and 15 percent are paid in the second month after sale. Expected cash receipts in July are budgeted at what amount? a. 114,520 b. 143,150 c. 145,720 d. 156,000
Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the follow sales: In Shalimars experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are 4,900,000 and for the fourth quarter of the current year are 6,850,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. 2. Construct a cash receipts budget for Shalimar Company for each quarter of the next year, showing the cash sales and the cash collections from credit sales. 3. What if the recession led Shalimars top management to assume that in the next year 10 percent of credit sales would never be collected? The expected payment percentages in the quarter of sale and the quarter after sale are assumed to be the same. How would that affect cash received in each quarter? Construct a revised cash budget using the new assumption.
Nozama.com Inc. sells consumer electronics over the Internet. For the next period, the budgeted cost of the sales order processing activity is 250,000 and 50,000 sales orders are estimated to be processed. a. Determine the activity rate of the sales order processing activity. b. Determine the amount of sales order processing cost associated with 30,000 sales orders.
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