Question

MC Qu. 142 Memphis Company anticipates total... Memphis Company anticipates total sales for April, May, and June of $840,000, $940,000, and $990,000 respectively. Cash sales are normally 20% of total sales. Of the credit sales, 35% are collected in the same month as the sale, 60% are collected during the first month after the sale, and the remaining 5% are not collected. Compute the amount of cash received from total sales during the month of June.

Answer 1

Answer:

Total= $926,400

Explanation:

Giving the following information:

Sale:

April= 840,000

May= 940,000

June= 990,000

Cash sales are normally 20% of total sales.

Of the credit sales, 35% are collected in the same month as the sale, 60% are collected during the first month after the sale, and the remaining 5% are not collected.

Cash collection for June:

From June in cash= (990,000*0.2)= 198,000

From June in credit= (990,000*0.8)*0.35= 277,200

From May in credit= (940,000*0.8)*60= 451,200

Total= $926,400