Schedule of Cash Collections on Accounts Receivable and Cash Budget Bennett Inc.

Question

Schedule of Cash Collections on Accounts Receivable and Cash Budget Bennett Inc. found that about 15% of its sales dunng the month were for cash. Bennett has the flowing accounts receivable payment experience: Percent paid in the month of sale Percent paid in the month after the sale Percent paid in the second month after the sale Bennett's anticipated sales for the next few months are as follows: April May June July August Required: 1. Calculate credit sales for May. 25 68 $250,000 290,000 280,000 295,000 300,000 Calculate credit sales for June. Calculate credit sales for July Calculate credit sales for August

Explanation / Answer

April may June July August Total sales 250000 290000 280000 295000 300000 Less: Cash sales @15% of total 37500 43500 42000 44250 45000 Credit sales for the month 212500 246500 238000 250750 255000 Req 1: Credit sales for May: $246,500 Req 2: Credit sales in June: $238,000 Req 3: Credit sales in July: $250,750 Req 4: Credit sales in August: 255,000

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