Question

Waterway Industries reported the following information for 2016: October November December Budgeted sales $950000 $890000 $1100000 All sales are on credit. Customer amounts on account are collected 50% in the month of sale and 50% in the following month. How much is the November 30, 2016 budgeted Accounts Receivable? $445000 $550000 $475000 $920000

Answer 1

Answer:

At November 30, 2016, budgeted Accounts Receivable is $445,000

Explanation:

In October, Sales: $950,000

Customer amounts on account are collected: 50% x $950,000= $475,000

At 31 October, Accounts Receivable = 50% x $950,000= $475,000

In November, Sales: $890,000

Customer amounts on account are collected = $475,000 + 50% x $890,000 = $920,000

At November 30, 2016 budgeted Accounts Receivable = 50% x $890,000 = $445,000