Royal Cigar Company is preparing a budget for cash collections. Its sales for November and December are estimated as $90,000 and $100,000, respectively. Past practice indicates that sales in any given month are collected as follows: month of sale, 75%; month following the month of sale, 20%; uncollectible accounts, 5%. The company allows a 2% discount for cash collections in the month of sale. What is the net cash estimated to be collected in December?
| Collections from November sales | 18000 | =90000*20% |
| Collections from December sales | 73500 | =100000*75%*0.98 |
| Net cash estimated to be collected in December | 91500 |
Royal Cigar Company is preparing a budget for cash collections. Its sales for November and December...
Royal Cigar Company is preparing a budget for cash collections. Its sales for November and December are estimated as $90,000 and $100,000, respectively. Past practice indicates that sales in any given month are collected as follows: month of sale, 75%; month following the month of sale, 20%; uncollectible accounts, 5%. The company allows a 2% discount for cash collections in the month of sale. What is the net cash estimated to be collected in December?
Fiscal Company has the following sales budget for the last six months of 2020: July $100,000 August 80,000 September 110,000 October 90,000 November 100,000 December 94,000 Historically, the cash collection of sales has been as follows: 65 percent of sales collected in month of sale, 25 percent of sales collected in month following sale, 8 percent of sales collected in second month following sale, and 2 percent of sales are uncollectible. Prepare a schedule of cash collections for October, November, and December of 2020. Make sure...
Monroe Group is preparing its cash collections budget. Budgeted sales are $150,000 in July, $175,000 in August, and $200,000 in September. Fifty percent of sales are cash sales; the remainder is on account. Sales on account are expected to be collected 30% in the month of sale, 60% in the month following the month of sale, and 10% in the second month following the month of sale. How much are anticipated cash collections during the month of September? $190,000 $180,000...
It is November 1 of Year 1. Sales for Mark Company for November and December of Year 1 and January of Year 2 are forecasted to be as follows: November, 300,000; December 700,000; January, 200,000 100% of sales are credit sales. Of these credit sales, 15% are collected during the month of sale, 25% in the following month, and 50% in the second following month; 10% are never collected. Total sales for September and October of Year 1 were 100,000...
It is November 1 of Year 1. Sales for Joseph Company for November and December of Year 1 and January (of Year 2) are forecasted to be as follows: November, 300,000; December 700,000; January, 200,000 90% of sales are credit sales; the remaining sales are cash sales. Of these credit sales, 15% are collected during the month of sale, 25% in the following month, and 50% in the second following month; 10% are never collected. Total sales for September and...
Budgeted sales in Washburn Company over the next four months are given below: September October November December Budgeted sales $100,000 $160,000 $180,000 $120,000 Twenty-five percent of the company's sales are for cash and 75% are on account. Collections for sales on account follow a stable pattern as follows: 50% of a month's credit sales are collected in the month of sale, 30% are collected in the month following sale, and 15% are collected in the second month following sale. The...
Budgeting Cash Collections Spencer Consulting, which invoices its clients on terms 2/10, n/30, had credit sales for May and June of $150,000 and $170,000, respectively. Analysis of Spencer’s operations indicates that the pattern of customers’ payments on account is as follows (percentages are of total monthly credit sales): Receiving Discount Beyond Discount Period Totals In month of sale 50% 25% 75% In month of following sale 10% 10% 20% Uncollectible accounts, returns, and allowances 5% 100% Determine the estimated cash...
CASH BUDGET – Chapter 8 You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company’s operations: The cash balance on December 1 is $52,000. The company requires a minimum cash balance of $20,000. Actual sales for October and November and expected sales for December are as follows: Sales (all on credit) October $650,000 November $775,000 December $890,000 Collections for Sales are as follows: 20%...
On October 1 of the current year, Molloy Corporation prepared a cash budget for October, November, and December. All of Molloy's sales are made on account. The following information was used in preparing estimated cash collections: August sales (actual) $ 47,000 September sales (actual) $ 57,000 October sales (estimated) $ 27,000 November sales (estimated) $ 77,000 December sales (estimated) $ 67,000 Approximately 65% of all sales are collected in the month of the sale, 20% is collected in the following...
On October 1 of the current year, Malone Corporation prepared a cash budget for October, November, and December. All of Malone's sales are made on account. The following information was used in preparing estimated cash collections: August sales (actual) $ 49,000 September sales (actual) $ 59,000 October sales (estimated) $ 29,000 November sales (estimated) $ 79,000 December sales (estimated) $ 69,000 Approximately 60% of all sales are collected in the month of the sale, 30% is collected in the following...