Chapter 8, Problem 34E

A company’s 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 month’s 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?

1. a. $114,520
2. b. $143,150
3. c. $145,720
4. d. $156,000