Question

Learning Objective: Estimate Receipts Preston's Parties specilized in custom birthday parties for children for an average price of $1,600. He receives a 20% deposit two months in advance, a payment of 50% one month in advance and the remaining 30% on the day of the party. Preston anticipates the following number of parties for each of the next six months: March April May June July NAG August Part A calculate expected revenue for March - August March April May June July August Total Revenue Receipts Budget Total Receipts for Period March April May June July August March Sales April Sales May Sales June Sales July Sales August Sales Total

Answer 1

Expected revenue:

Month	Parties	x	Average Price	=	Expected Revenue
March	5	x	$1,600	=	$8,000
April	3	x	$1,600	=	$4,800
May	15	x	$1,600	=	$24,000
June	4	x	$1,600	=	$6,400
July	5	x	$1,600	=	$8,000
August	2	x	$1,600	=	$3,200

Receipt Budget:

	March	April	May	June	July	August	Total receipts for period
March Sales	$2,400						$2,400
April Sales	$2,400	$1,440					$3,840
May Sales	$4,800	$12,000	$7,200				$24,000
June Sales		$1,280	$3,200	$1,920			$6,400
July Sales			$1,600	$4,000	$2,400		$8,000
August Sales				$640	$1,600	$960	$3,200
Total	$9,600	$14,720	$12,000	$6,560	$4,000	$960	$47,840

Calculations:

	Revenue	% of collection	March	April	May	June	July	August
March Sales	$8,000
Received in March		30%	$2,400
April Sales	$4,800
Received in March		50%	$2,400
Received in April		30%		$1,440
May Sales	$24,000
Received in March		20%	$4,800
Received in April		50%		$12,000
Received in May		30%			$7,200
June Sales	$6,400
Received in April		20%		$1,280
Received in May		50%			$3,200
Received in June		30%				$1,920
July Sales	$8,000
Received in May		20%			$1,600
Received in June		50%				$4,000
Received in July		30%					$2,400
August Sales	$3,200
Received in June		20%				$640
Received in July		50%					$1,600
Received in August		30%						$960
Total			$9,600	$14,720	$12,000	$6,560	$4,000	$960