Answer:
The total cash collected during January by Lagrange Corporation would be $155,800.
Explanation:
Total cash collection represent the sum of cash sales and credit sales
The total cash collection during January is shown below:
1. Cash sales - $ 30,000
2. Based on the criteria of collection, the computation is given below:
Credit sales
50% in month of sale i.e January = $ 130,000 × 50% = $65,000
40% in month following sale i.e December = ($56,000 × 40 ) ÷ 50 = $44800
10% in second month following sale i.e. November = $16,000
Since, The December and November sales is not given, so we considered accounts receivable balance of December and November
For December sale = $56,000 is given in the question but 40% is considered so multiply by 40% and in January 50% is collection ,so for December we divide by 50% as it denotes remaining percentage
And for November, it is given in the question i.e. $16,000
Thus, the total sales = cash sales + credit sales of all three months
= $ 30,000 + $65,000 + $44800 + $16,000
= $155,800
Hence, The total cash collected during January by Lagrange Corporation would be $155,800.
