Cash Sales Credit Sales January $ 50,000 $ 150,000 February $ 55,000 $ 170,000 March $ 43,000 $ 130,000 April $ 38,000 $ 123,000 May $ 48,000 $ 200,000 June $ 80,000 $ 170,000 The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on sales: 50% in month of sale 40% in month following sale 10% in second month following sale The accounts receivable balance on January 1 of the current year was $65,000, of which $42,000 represents uncollected December sales and $23,000 represents uncollected November sales. The total cash collected during January by LaGrange Corporation would be:

Question

Business

Miley Barajas

21 November, 10:27

Cash Sales Credit Sales January $ 50,000 $ 150,000 February $ 55,000 $ 170,000 March $ 43,000 $ 130,000 April $ 38,000 $ 123,000 May $ 48,000 $ 200,000 June $ 80,000 $ 170,000 The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on sales: 50% in month of sale 40% in month following sale 10% in second month following sale The accounts receivable balance on January 1 of the current year was $65,000, of which $42,000 represents uncollected December sales and $23,000 represents uncollected November sales. The total cash collected during January by LaGrange Corporation would be:

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Lizbeth Banks · Answer 1

Cash collection budget

January

Cash sales $50,000

Credit sales:

50% of January credit sales $75,000 ($150,000*50%)

40% of December credit sales $33,600 ($42,000/50%*40%)

10% of November credit sales $23,000 ($23,000/10%*10%)

Total cash collections $181,600