Firm sales for July are projected as $100,000. The sales in May and June were $60,000 and $75,000 respectively. The firm's collection during month of sales id 15%, during month after sales is 65% and during two months after sales is 20%. The firm offers a 3% incentive to pay during month of sales. Further, firm applies a bad debt loss of 10% two months after sale (June Sales). What is the expected cash collection for the month of July a.$75,750 b.74100 c.$100,000 d.$$97,000 e.None of the above

The cash collection schedule is prepared to record the cash collected by firms during the period.

Answered: Firm sales for July are projected as…

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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Firm sales for July are projected as $100,000. The sales in May and June were $60,000 and $75,000 respectively. The firm's collection during month of sales id 15%, during month after sales is 65% and during two months after sales is 20%. The firm offers a 3% incentive to pay during month of sales. Further, firm applies a bad debt loss of 10% two months after sale (June Sales). What is the expected cash collection for the month of July

a.

$75,750

b.

74100

c.

$100,000

d.

$$97,000

e.

None of the above

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