Moorcroft Company's budgeted sales and direct materials purchases are as follows: Budgeted Sales Budgeted D.M. Purchases April $299,000 $48,000 May 330,000 49,000 June 398,000 54,000
Moorcroft Company's budgeted sales and direct materials purchases are as follows: Budgeted Sales Budgeted D.M. Purchases April $299,000 $48,000 May 330,000 49,000 June 398,000 54,000
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter13: Budgeting And Standard Costs
Section: Chapter Questions
Problem 13.2.1P: Budgeted income statement and supporting budgets The budget director of Jupiter Helmets Inc., with...
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Moorcroft’s assistant controller suggested that Moorcroft hire a part time collector to encourage customers to pay more promptly and to reduce the amount of uncollectible accounts. Sales are still 40% cash and 60% credit but the assistant controller predicted that this would cause credit sales to be collected 30% in the month of the sale, 50% in the month following sale, and 18% in the second month following sale; 2% are uncollectible.
Prepare a schedule of expected collections from customers for June. How did these changes impact cash collections?
Moorcroft Company Schedule of Expected Collections from Customers |
||||||||
Sales | April | May | June | |||||
April | $ | $ | $ | $ | ||||
May | ||||||||
June | ||||||||
Total Collections | $ | $ | $ |
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