Answer: Option (v) is correct
Explanation:
Given that,
Natcher Corporation collects,
35% of a month's sales in the month of sale
40% in the month following sale
20% in the second month following sale
5% of their sales are noncollectable
Budgeted sales are:
August budgeted sales = $250,000
September budgeted sales = $350,000
October budgeted sales = $390,000
November budgeted sales = $230,000
Amount of cash collected in November is budgeted:
= 35% of November sale + 40% of October sale + 20% of September sale
= 35% of $230,000 + 40% of $390,000 + 20% of $350,000
= $80,500 + $156,000 + $70,000
= $306,500
