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r Login Chapter 8 Graded Exercises Help Save& Exit Saved Silver Company makes a product that is very popular as a Mother\'s Day gift. Thus, peak sales occur in May of each year, as shown in the company\'s sales budget for the second quarter given below une Total Budgeted sales (all on account) points $480,00 $680,000 $260,000 $1,420,000 From past experience, the company has learned that 30% of a month\'s sales are collected in the month of sale, another 60% are collecte ed in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $410,000, and March sales totaled $440,000. 1. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. 2. What is the accounts receivable balance on June 3Oth? Complete this question by entering your answers in the tabs below What is the accounts recelvable balance on June 30th? Required 1

Solution

Feb

March

April

May

June

sales/budgeted sale

410000

440000

480000

680000

260000

cash collection

April

May

June

total

30% of month sale

144000

204000

78000

60% in the month following sale

264000

288000

408000

10% in the second month of following sale

41000

44000

48000

total cash collection of month

449000

536000

534000

1519000

Account receivable balance on june 30

60% balance of may sale

440000*10%

44000

70% of june sales

260000*70%

182000

Account receivable balance on june 30

226000

		Feb	March	April	May	June
sales/budgeted sale		410000	440000	480000	680000	260000
cash collection		April	May	June	total
30% of month sale		144000	204000	78000
60% in the month following sale		264000	288000	408000
10% in the second month of following sale		41000	44000	48000
total cash collection of month		449000	536000	534000	1519000
Account receivable balance on june 30
60% balance of may sale	440000*10%	44000
70% of june sales	260000*70%	182000
Account receivable balance on june 30		226000