The Warrenburg Antique Mall budgeted credit sales in the first quarter of 2012 t
ID: 2353883 • Letter: T
Question
The Warrenburg Antique Mall budgeted credit sales in the first quarter of 2012 to be as follows:January $135,000
February 143,000
March 154,000
Credit sales in December 2011 are expected to be $186,000. The company expects to collect 64 percent of a month’s sales in the month of sale and 36 percent in the following month.
Estimate cash receipts for each month of the first quarter of 2012.
January February March
Collection of credit sales
Collection of December sales $
Collection of January sales $
Collection of January sales $
Collection of February sales $
Collection of February sales $
Collection of March sales $
$ $ $
Explanation / Answer
Collection of credit sales
Jan
Feb
Mar
Collection of December sales $
$ 66,960
Collection of January sales $
$ 86,400
Collection of January sales $
$ 48,600
Collection of February sales $
$ 91,520
Collection of February sales $
$ 51,480
Collection of March sales $
$ 98,560
Total
$ 153,360
$ 140,120
$ 150,040
January’s sales were found by taking 36% of December sales (186,000*.36) and 64% of January’s sales (135,000*.64)
February’s sales were found by taking 36% of January’s sales (135,000*.36) and 64% of February’s sales (143,000*.64)
Finally, March’s sales were found by taking 36% of February’s sales (143,000*.64) and 64% of March’s sales (154,000*.64)
Collection of credit sales
Jan
Feb
Mar
Collection of December sales $
$ 66,960
Collection of January sales $
$ 86,400
Collection of January sales $
$ 48,600
Collection of February sales $
$ 91,520
Collection of February sales $
$ 51,480
Collection of March sales $
$ 98,560
Total
$ 153,360
$ 140,120
$ 150,040
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