The accounts receivable balance at the end of the previous quarter was $97,750 (

Question

The accounts receivable balance at the end of the previous quarter was $97,750 ($71,050 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).)

Explanation / Answer

(a)Compute the sales for November. (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

  Sales = Account Recieveable of November outstanding at december end/ 15 percent in the second month after the sale

Sales = (97750-71050)/15%

Sales = 178000

(b)Compute the sales for December. (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

  Sales = 71050/(1-65%)

Sales = 203000

(c)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).)

Cash Collection :
  January = 141000*65% + 203000*20% + 178000*15%

January = $ 158950

  February =  158000*65% + 141000*20% + 203000*15%

February = $ 161350

  March = 173000*65% + 158000*25% + 141000*15%

March = $ 173100

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