Question 2 Shown below are budgeted sales for Betty DeRose, Inc.: Budgeted Sales

Question

Question 2

Shown below are budgeted sales for Betty DeRose, Inc.:

Budgeted Sales in Units

January 8,100 units
February 6,300 units
March 4,100 units
April 6,900 units
May ????? units

The selling price is $15 per unit. 20% of the company's sales are cash sales
and 80% of the company's sales are made on account. The sales on account are
collected in the pattern 30% in the month of sale, 35% in the month following
sale, 20% in the second month following sale, and the final 15% is collected
in the third month following sale.

Calculate the total expected cash collections for the month of April. Do not
use decimals in your answer.

Explanation / Answer

Cash sales 20700 =6900*15*20% Credit sales: January 14580 =8100*15*80%*15% February 15120 =6300*15*80%*20% March 17220 =4100*15*80%*35% April   24840 =6900*15*80%*30% Total expected cash collections in April 92460

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