Nocioni\'s Management Consultants has found that only 10% of its invoiced amount

Question

Nocioni's Management Consultants has found that only 10% of its invoiced amounts are paid in the same month that the work is completed. Sixty percent are paid in the month after the work is completed and 30% are paid in the second month after the work is completed.

During December 2007, Nocioni's invoiced $200,000 to clients. Projected revenues for the first six months of 2008 are given below:
Month Revenue
January $180,000
February 205,000
March 220,000
April 218,000
May 230,000
June 255,000

Reference: Ref 10-2

What are the expected cash receipts for May 2008?

Explanation / Answer

What are the expected cash receipts for May 2008? Mar April May Revenue of Mar 22,000 132,000 66000 Revenue of Apr 21,800 130,800 Revenue for May 23,000 Total of the month 219,800

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