The accounts receivable balance at the end of the previous quarter was $102,000
ID: 2651541 • Letter: T
Question
The accounts receivable balance at the end of the previous quarter was $102,000 ($83,600 of which was uncollected December sales).
Compute the sales for November. (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
Compute the sales for December. (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
Compute the cash collections from sales for each month from January through March. (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).)
The following is the sales budget for Segura, Inc., for the first quarter of 2013:Explanation / Answer
Answer:
(a) Accounts receivable balance at the end of the previous quarter (That is at the end of December) = $102000
December uncollected Sales =$83600
Hence November uncollected Sales 10% Part = 102000 -83600= $18400
Hence November Sales = 18400/10% =$184000
(b) December uncollected Sales (100-60) 40% Part =$83600
Hence December Sales = 83600 /40% = $209000
(c)
Calculation of Cash Collection
November
December
January
February
March
Sales
$ 184,000
$ 209,000
$ 147,000
$ 164,000
$ 179,000
Collection :
60 percent in the month of the sale
$ 88,200
$ 98,400
$ 107,400
(147000*60%)
(164000*60%)
(179000*60%)
30 percent in the month after the sale
$ 62,700
$ 44,100
$ 49,200
(209000*30%)
(147000*30%)
(164000*30%)
10 percent in the second month after the sale
$ 18,400
$ 20,900
$ 14,700
(184000*10%)
(209000*10%)
(147000*10%)
Total Cash Collection
$ 169,300
$ 163,400
$ 171,300
Calculation of Cash Collection
November
December
January
February
March
Sales
$ 184,000
$ 209,000
$ 147,000
$ 164,000
$ 179,000
Collection :
60 percent in the month of the sale
$ 88,200
$ 98,400
$ 107,400
(147000*60%)
(164000*60%)
(179000*60%)
30 percent in the month after the sale
$ 62,700
$ 44,100
$ 49,200
(209000*30%)
(147000*30%)
(164000*30%)
10 percent in the second month after the sale
$ 18,400
$ 20,900
$ 14,700
(184000*10%)
(209000*10%)
(147000*10%)
Total Cash Collection
$ 169,300
$ 163,400
$ 171,300
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