The accounts receivable balance at the end of the previous quarter was $128,900

Question

The accounts receivable balance at the end of the previous quarter was $128,900 ($92,700 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

Sales for November:

November Sales payment will come in November, december and January.

At the end of previous quarter Total account receivable was $128900 Out of which $92700 was december months uncollected sales thus remaining ($36200)is november months uncollected sales which corresponds to 20% of the november months sale.

36200 corresponds to 20%

so 100% will correspond to $181000

November Sale=$181000

December sale?

Sales of Decembr will come in december jan and feb

Uncollected amount is $97200 which corresponds to 45%(which will come in jan and feb)

Thus total december sale= $216000

                     Cash Collection

January       $169400(55%*14400+25%*216000+20%*181000)

February      $167750(55%*161000+25%144000+20%*216000)

March        $165850(55%*176000+25%*161000+20%*144000)

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.