Question

Preparing a Schedule of Cash Collections on Accounts Receivable

Answer 1

Answer:

                                Kailua and Company

                          Schedule of Cash Collections

                                                                    August           September

Cash collections from June                       $25,200                      $0

Cash collections from July                        $38,500             $19,250

Cash collections from August                    $17,220            $43,050

Cash collections from September                      $0             $17,800  

Total cash collections                               $80,920             $80,100

I suppose that 5% of the billings are uncollectible since 20% + 50% + 25% = 95%.