Qw.3.Craig has projected sales to be $90,400 in April; $96,400 in May; $104,500 in June and $93,600 in July. The history of Craig’s sales indicates 20% cash and the remaining 80% on credit. The company’s collection history indicates that credit sales are collected as follows: 30% collected in the month of the sale60% collected in the month after the sale8% collected two months after the sale2% of credit sales are never collected Prepare a Sales Budget for all four months, showing breakdown between cash and credit salesSales BudgetTotal salesCash salesCollection of credit sales:Craig's Design and LandscapingSales BudgetMayAprilPrepare the Cash Budget for June and July. Round all answers to nearest dollarCash Collections BudgetTotal cash collectionsTotal collection of credit salesJuneCraig's Design and LandscapingBudgeted Cash Collections from CustomersJuneArea to show work for collection of credit sales: (optional)JulyJulyWhat does the 2% of credit sales not collected represent? Should this be of concern for Craig?

CASH BUDGET Cash Budget is a detailed budget of cash income and cash expenditure incorporating both…

Answered: Prepare a Sales Budget for all four…

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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Qw.3.

Craig has projected sales to be $90,400 in April; $96,400 in May; $104,500 in June and $93,600 in July. The history of Craig’s sales indicates 20% cash and the remaining 80% on credit.

The company’s collection history indicates that credit sales are collected as follows:

30% collected in the month of the sale60% collected in the month after the sale8% collected two months after the sale2% of credit sales are never collected

Prepare a Sales Budget for all four months, showing breakdown between cash and credit sales
Sales Budget
Total sales
Cash sales
Collection of credit sales:
Craig's Design and Landscaping
Sales Budget
May
April
Prepare the Cash Budget for June and July. Round all answers to nearest dollar
Cash Collections Budget
Total cash collections
Total collection of credit sales
June
Craig's Design and Landscaping
Budgeted Cash Collections from Customers
June
Area to show work for collection of credit sales: (optional)
July
July
What does the 2% of credit sales not collected represent? Should this be of concern for Craig?

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