(TCO 7) XYZ Company expects the following sales and collection pattern for the f
ID: 1096589 • Letter: #
Question
(TCO 7) XYZ Company expects the following sales and collection pattern for the first four months of the year:
Month Cash Sales Credit Sales Total Sales
January $12,000 $23,000 $35,000
February $8,000 $22,000 $30,000
March $9,000 $25,000 $34,000
April $11,000 $28,000 $39,000
· 5% of credit sales are collected in the same month
· 75% of sales are collected in the following month
· 15% of sales are collected in the second following month
What are the projected cash collections for the month of March? (Points : 4)
$17,250
$21,200
$30,200
$41,200
Explanation / Answer
cash flow = 25000 * 5% + 22000 * 75% + 23000 * 15% + 9000
= 30200
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