Sheffield Corp. estimates its sales at 200000 units in the first quarter and that sales will increase by 25000 units for each subsequent quarter during the year. The company has, and desires, an ending finished goods inventory to 25% of the next quarter's sales. Each unit sells for $30. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is collected in the quarter following the sale. Cash collections for the third quarter are budgeted at O $7365000. O $6150000. O $4215000. O $8812500.

Sheffield Corp. estimates its sales at 200000 units in the first quarter and that sales will increase by 25000 units for each subsequent quarter during the year. The company has, and desires, an ending finished goods inventory to 25% of the next quarter's sales. Each unit sells for $30. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is collected in the quarter following the sale. Cash collections for the third quarter are budgeted at O $7365000. O $6150000. O $4215000. O $8812500.

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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