The following credit and cash sales (respectively) are budgeted by Polex Electro

Question

The following credit and cash sales (respectively) are budgeted by Polex Electronics:

       Credit         Cash

                  January                  $124,000,    $6,000

                  February                120,000,    10,000

                  March                     135,000,      5,000

                  April                        140,000,    20,000

                  May                        142,000,      8,000

            The company's past experience indicates that 50% of the accounts receivable are collected in the month of sale, 30% in the month following the sale, and 20% in the second month following the sale. How much does the company anticipate as cash receipts for March?

Explanation / Answer

for march thet expect 20 % of january crdit sales and 30 % of febuary sales and 50 % of march credit sales

= 20 % of 124000 + 30 5 %f 120000 + 50 % of 135000 + 5000 =133300

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