ZZ, Inc. has budgeted sales in units for the next six months as follows: Budgeted Sales in Units July 7,700 units August 8,300 units September 5,400 units October 10,200 units November ?????? units December 11,700 units The selling price is $18 per unit. 30% of the company's sales are cash sales and 70% of the company's sales are made on account. The sales on account are collected in the pattern 15% in the month of sale, 20% in the month following sale, 55% in the second month following sale, and the final 10% is collected in the third month following sale. Calculate the total expected cash collections for the month of October.
October | ||
Cash sales | 55080 | =10200*18*30% |
Credit sales: | ||
Collection from July sales | 9702 | =7700*70%*10% |
Collection from August sales | 57519 | =8300*18*70%*55% |
Collection from September sales | 13608 | =5400*18*70%*20% |
Collection from October sales | 19278 | =10200*18*70%*15% |
Total expected cash collections | 155187 |
Collection in October | |
July Account Sales (7,700 units * 70% * 10%) *$18 | $9,702 |
August Account Sales (8,300 units * 70% * 55%) *$18 | $57,519 |
September Account Sales (5,400 units * 70% * 20%)*$18 | $13,608 |
October Account Sales (10,200 units * 70% * 15%) *$18 | $19,278 |
October Cash Sales (10,200 units * 30%) *$18 | $55,080 |
Total Expected Cash Collections for the month of October |
$155,187 |
ZZ, Inc. has budgeted sales in units for the next six months as follows: Budgeted Sales...
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