Question

Astor Manufacturing has the following budgeted sales: January $120,000, February $180,000, and March $150,000. 40% of the sales are for cash and 60% are on credit. For the credit sales, 50% are collected in the month of sale, and 50% the next month. The total expected cash receipts during March are:

Answer 1

Answer:

Total cash= $159,000

Explanation:

Giving the following information:

Sales:

January $120,000

February $180,000

March $150,000

40% of the sales are for cash and 60% are on credit.

For credit sales, 50% are collected in the month of sale, and 50% the next month.

Cash collection March:

Sales in cash= 150,000*0.4= 60,000

Sales on account:

From March= (150,000*0.6)*0.5= 45,000

From Fecruary=(180,000*0.6)*0.5= 54,000

Total cash= $159,000