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Schedule of Cash Collections of Accounts Receivable OfficeMart Inc. has "cash and carry" customers and credit...

  1. Schedule of Cash Collections of Accounts Receivable

    OfficeMart Inc. has "cash and carry" customers and credit customers. OfficeMart estimates that 20% of monthly sales are to cash customers, while the remaining sales are to credit customers. Of the credit customers, 20% pay their accounts in the month of sale, while the remaining 80% pay their accounts in the month following the month of sale. Projected sales for the next three months are as follows:

    October $117,000
    November 146,000
    December 214,000

    The Accounts Receivable balance on September 30 was $78,000.

    Prepare a schedule of cash collections from sales for October, November, and December. Round all calculations to the nearest whole dollar.

    OfficeMart Inc.
    Schedule of Cash Collections from Sales
    For the Three Months Ending December 31
    October November December
    Receipts from cash sales:
    Cash sales $ $ $
    September sales on account:
    Collected in October
    October sales on account:
    Collected in October
    Collected in November
    November sales on account:
    Collected in November
    Collected in December
    December sales on account:
    Collected in December
    Total cash receipts $ $ $

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OfficeMart Inc.
Schedule of Cash Collections from Sales
For the Three Months Ending December 31
October November December
Receipts from cash sales:
Cash sales $     23,400.00 $       29,200.00 $   42,800.00
September sales on account:
Collected in October $     78,000.00
October sales on account:
Collected in October $     18,720.00
Collected in November $       74,880.00
November sales on account:
Collected in November $       23,360.00
Collected in December $   93,440.00
December sales on account:
Collected in December $   34,240.00
Total cash receipts $    120,120.00 $      127,440.00 $ 170,480.00

Working

October November December
Total Sales (A) $      117,000.00 $        146,000.00 $ 214,000.00
Cash sales (B= A x 20%) $        23,400.00 $           29,200.00 $     42,800.00
Credit sales (C= A-B) $        93,600.00 $        116,800.00 $ 171,200.00
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