Valentina Company will begin operations on January 1st. The company has provided the following details concerning budgeted sales: Budgeted Sales Jan $75,000 Feb 69,000 March 80,000 April 82,000 May 80,500 June 92,000 The collection policy of the company is to collect 20% in the month of sale, 40% in the following month, and remaining 40% in the second month after the month of sale. All sales are made on account. Calculate the cash receipts from customers for the first six months.
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.
Valentina Company will begin operations on January 1st. The company has provided the following details concerning budgeted sales:
Budgeted Sales
Jan $75,000
Feb 69,000
March 80,000
April 82,000
May 80,500
June 92,000
The collection policy of the company is to collect 20% in the month of sale, 40% in the following month, and remaining 40% in the second month after the month of sale. All sales are made on account.
Calculate the cash receipts from customers for the first six months.
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