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14 June, 06:15

Center Company makes collections on sales according to the following schedule: 40% in the month of sale 50% in the month following sale 7% in the second month following sale The following sales are expected: Expected Sales January$115,000 February$150,000 March$130,000 Cash collections in March should be budgeted to be:

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  1. 14 June, 07:32
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    The cash collections in March is budgeted to be $135050

    Explanation:

    The collection of cash in March will consist of cash received for 7% of January's sales, 50% of February sales and 40% of Marc's sales. We assume that all the sales mentioned are credit sales and apply these percentages on the whole amount of sales given for each month.

    Cash collection in March = 0.07 * 115000 + 0.5 * 150000 + 0.4 * 130000

    Cash collection March = $135050
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