Graham Potato Company has projected sales of $12,000 in September, $15,000 in October, $22,000 in November, and $18,000 in December. Of the company's sales, 30 percent are paid for by cash and 70 percent are sold on credit. Experience shows that 40 percent of accounts receivable are paid in the month after the sale, while the remaining 60 percent are paid two months after. Determine collections for November and December. Also assume Graham's cash payments for November and December are $18,500 and $11,000, respectively. The beginning cash balance in November is $5,000, which is the desired minimum balance. a. Prepare a cash receipts schedule for November and December. Graham Potato Company Cash Receipts Schedule Sales Credit sales Cash sales One month after sale Two months after sale Total cash receipts September October November December

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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Graham Potato Company has projected sales of $12,000 in September, $15,000 in October, $22,000 in November, and $18,000 in
December. Of the company's sales, 30 percent are paid for by cash and 70 percent are sold on credit. Experience shows that 40
percent of accounts receivable are paid in the month after the sale, while the remaining 60 percent are paid two months after.
Determine collections for November and December.
Also assume Graham's cash payments for November and December are $18,500 and $11,000, respectively. The beginning cash
balance in November is $5,000, which is the desired minimum balance.
a. Prepare a cash receipts schedule for November and December.
Graham Potato Company
Cash Receipts Schedule
Sales
Credit sales
Cash sales
One month after sale
Two months after sale
Total cash receipts
September
October
November
December
Transcribed Image Text:Graham Potato Company has projected sales of $12,000 in September, $15,000 in October, $22,000 in November, and $18,000 in December. Of the company's sales, 30 percent are paid for by cash and 70 percent are sold on credit. Experience shows that 40 percent of accounts receivable are paid in the month after the sale, while the remaining 60 percent are paid two months after. Determine collections for November and December. Also assume Graham's cash payments for November and December are $18,500 and $11,000, respectively. The beginning cash balance in November is $5,000, which is the desired minimum balance. a. Prepare a cash receipts schedule for November and December. Graham Potato Company Cash Receipts Schedule Sales Credit sales Cash sales One month after sale Two months after sale Total cash receipts September October November December
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