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The following is the sales budget for Coore, Inc
The following is the sales budget for Coore, Inc., for the first quarter of 2019:
JanuaryFebruaryMarch Sales budget$146,000$163,000$178,000
Credit sales are collected as follows:
70 percent in the month of the sale25 percent in the month after the sale5 percent in the second month after the sale The accounts receivable balance at the end of the previous quarter was $71,550 ($62,400 of which was uncollected December sales). a.Compute the sales for November. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
b.Compute the sales for December. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)c.Compute the cash collections from sales for each month from January through March. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)
Expert Solution
| 1) | Computation of Sales for November: | ||||
| Cash Collected from Sales = 70% | |||||
| Uncolllected Sales Amount = $62,400 | |||||
| Total sales in December = 62400/30% | |||||
| Total Sales in December | 208000 | ||||
| 2) | Computation of Sales for December: | ||||
| Total Account Receivable = 5% of November Sales + Uncollected Amount of December Sale | |||||
| 71550 = 5% of November Sale + 62400 | |||||
| 5% November Sale | 9150 | ||||
| November Sale | $9,150/5% | ||||
| November Sale | 183000 | ||||
| 3) | Computation of Cash Collection from Sales for Each Month: | ||||
| January | February | March | |||
| Sales | 146000 | 163000 | 178000 | ||
| Sales Collected in Month of Sale @70% | 102200 | 114100 | 124600 | ||
| Sales Collected from Previos Month Sale @25% | 52000 | 36500 | 40750 | ||
| Sales Collected from Previous Two Month Sale @5% | 9150 | 10400 | 7300 | ||
| Cash Collection | 163350 | 161000 | 172650 | ||
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