Cash Collections E8A. Five Bros., Inc., is an automobile maintenance and repair
ID: 2409182 • Letter: C
Question
Cash Collections E8A. Five Bros., Inc., is an automobile maintenance and repair company with outlets throughout the western United States. The company controller is starting to assemble the cash budget for the fourth quarter. Projected sales for the quarter follow On Account $400,000 690,000 750,000 Cash $190 October November December ,000 220,000 245,000 Cash collection records pertaining to sales on account indicate the following collec- tion pattern: Month of sale First month following sale Second month following sale Uncollectible 4096 30% 28% 2% Sales on account during August were $346,000. During September, sales on account were $390,000. Comp ute the amount of cash to be collected from customers during each month of the fourth quarterExplanation / Answer
Ans:
Five Bros Inc.
All Amounts in $
Cash Collections from Customers in each month of the fourth quarter
October
November
December
Collections from Cash Sales
190000
220000
245000
Collections from Sales on Account
Sales in August
96880
Sales in September
117000
109200
Sales in October
160000
120000
112000
Sales in November
276000
207000
Sales in December
300000
Total Collections for the month
563880
449200
357000
Five Bros Inc.
All Amounts in $
Cash Collections from Customers in each month of the fourth quarter
October
November
December
Collections from Cash Sales
190000
220000
245000
Collections from Sales on Account
Sales in August
96880
Sales in September
117000
109200
Sales in October
160000
120000
112000
Sales in November
276000
207000
Sales in December
300000
Total Collections for the month
563880
449200
357000
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