Answer:
The correct answer is $588,000.
Explanation:
According to the scenario, the computation of the given data are as follows:
We can calculate the cash receipts for Quarter 4 by using following formula:
Cash receipts for Quarter 4 = Cash Sales + Cash collected from credit sales in Qtr 4 + Accounts receivable of Qtr 3
Where, Cash sales = $580,000 × 50% = $290,000
Cash collected from credit sales in Qtr 4 = ($580,000 × 50%) ×60% = $174,000
Accounts receivable of Qtr 3 = ($620,000 × 50%) × 40% = $124,000
By putting the value, we get
Cash receipts = $290,000+$174,000+$124,000
= $588,000
