Budgeting Cash Whitney's, Inc., sells on terms of 5% discount for "cash and carry" or 2/10, n/30 and estimates its total sales for the second calendar quarter of next year as follows: April, $750,000 May, $600,000 and june, $900,000. An analysis of operations indicates the following customer collection patterns: In month of sale Portion Total Sales Cash at time of sale 25% On account, during discount period 15% On account, after discount period 10% In month following sale On account, during discount period 20% On account, after discount period 10% In second month following sale On account, after discount period Average portion uncollectible 15% 5% 100% Prepare an estimate of the cash to be collected from customers during June. Estimated Collections from Customers in June April Sales On account, no discount May Sales 0 On account, no discount On account, with discount 0 June sales On account, no discount On account, with discount Cash Total estimated June collections Check 0 0 0 5 0

Budgeting Cash Whitney's, Inc., sells on terms of 5% discount for "cash and carry" or 2/10, n/30 and estimates its total sales for the second calendar quarter of next year as follows: April, $750,000 May, $600,000 and june, $900,000. An analysis of operations indicates the following customer collection patterns: In month of sale Portion Total Sales Cash at time of sale 25% On account, during discount period 15% On account, after discount period 10% In month following sale On account, during discount period 20% On account, after discount period 10% In second month following sale On account, after discount period Average portion uncollectible 15% 5% 100% Prepare an estimate of the cash to be collected from customers during June. Estimated Collections from Customers in June April Sales On account, no discount May Sales 0 On account, no discount On account, with discount 0 June sales On account, no discount On account, with discount Cash Total estimated June collections Check 0 0 0 5 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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