Question

the company's sales budget for the second quarter given below: Budgeted sales (all on account) April $360,000 May $560,000 June $220,000 Total $1,140,000 From past experience, the company has learned that 30% of a month's sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $290,000, and March sales totaled $320,000. Required: 1. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. 2. What is the accounts receivable balance on June 30th? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. Schedule of Expected Cash Collections April May June Total February sales March sales April sales May sales June sales Total cash collections

Answer 1

The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and calculation. For detailed answer refer to the supporting sheet.

Total 29000 224000 360000 Answer 2 Part 1) Schduele of Expected Cash Collections April May June 5 Febraury Sales 29000 (290000*10%) 7 March Sales 192000 32000 (320000*60%) (320000*10%) 9 April Sales 108000 216000 36000 (360000*30%) (360000*60%) (360000*10%) 11 May Sales 168000 336000 (560000*30%) (560000*60%) 13 June Sales 66000 (220000*30%) 15 Total Cash Collections 329000 416000 438000 16 Note the unbold amounts are not part of final answer and are just for understanding only. 17 18 Part 2) 19 Account recievable balance at June 30 is $ 210000 10 504000 12 66000 1183000 21 Calculation 22 Account recievable balance at June 30 is 23 = May sales*10% +(june sales*70%) 24 = (560000*10%)+(220000*70%) 25 = $ 210000