Problem

Cash receipts budget Kiel Center’s sales are all made on account. The firm’s collection ex...

Cash receipts budget Kiel Center’s sales are all made on account. The firm’s collection experience has been that 35% of a month’s sales are collected in the month the sale is made, 55% are collected in the month following the sale, and 8% are collected in the second month following the sale. The sales forecast for the months of June through September is:

June

$140,000

July  

160,000

August  

170,000

September

195,000

Required:

Calculate the cash collections that would be included in the cash budgets for August and September.

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