Question

Cash receipts A firm has actual sales of $62,000 in April and $59,000 in May. It expects sales of $70,000 in June and $104,000 in July and in August. Assuming that sales are the only source of cash inflows and that half of them are for cash and the remainder are collected evenly over the following 2 months, what are the firm's expected cash receipts for June, July, and August? June July August April 62,000 $ May 59,000 $ Sales $ 70,000 $ 104,000 $ 104,000 Cash sales Collections: Lag 1 month A Lag 2 months A Total cash receipts Enter any number in the edit fields and then click Check Answer.

Answer 1

	April	May	June	July	August
Sales	62000	59000	70000	104000	104000
Cash sales	31000 [ 62000*50% ]	29500 [ 59000*50% ]	35000 [ 70000*50% ]	52000 [ 104000*50% ]	52000 [ 104000*50% ]
Collections :
Lag 1 month		15500 [ 62000*50%*1/2 ]	14750 [ 59000*50%*1/2 ]	17500 [ 70000*50%*1/2 ]	26000 [ 104000*50%*1/2 ]
Lag 2 month			15500 [ 62000*50%*1/2 ]	14750 [ 59000*50%*1/2 ]	17500 [ 70000*50%*1/2 ]
Total cash receipts			65250	84250	95500