Help Sa Silver Company makes a product that is very popular

Help Sa 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 $390,000 $590,000 $230,000 $1,210,000 From past experience, the company has learned that 25% of a month\'s sales are collected in the month of sale, another 60% are collected in the month following sale, and the remaining 15% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $320,000, and March sales totaled $350,000. Required 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 30th? Complete this question by entering your answers in the tabs below. Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter of Prev , 1 of 3 Next > 9

Solution

Schedule of expected cash collection :

b) Account receivable balance on june 30 = (590000*15%+230000*75%) = $261000

	April	May	June	Total
February Sales	48000			48000
March sales	210000	52500		262500
April Sales	97500	234000	58500	390000
May sales		147500	354000	501500
June sales			57500	57500
Total	355500	434000	470000	1259500