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Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below: April May June Total Budgeted sales (all on account) $ 370,000 $570,000 $180,000 $ 1,120,000 The company estimates 25% of a month's sales are collected in the month of sale, another 65% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $300,000, and March sales totaled $330,000. Required: Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. What is the accounts receivable balance on June 30th?

Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below: April May June Total Budgeted sales (all on account) $ 370,000 $570,000 $180,000 $ 1,120,000 The company estimates 25% of a month's sales are collected in the month of sale, another 65% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $300,000, and March sales totaled $330,000. Required: Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. What is the accounts receivable balance on June 30th?

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 15E: Palmgren Company produces consumer products. The sales budget for four months of the year is...
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Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below: April May June Total Budgeted sales (all on account) $ 370,000 $570,000 $180,000 $ 1,120,000 The company estimates 25% of a month's sales are collected in the month of sale, another 65% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $300,000, and March sales totaled $330,000. Required: Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. What is the accounts receivable balance on June 30th?
Transcribed Image Text:Silver Company makes a product with peak sales in May of each year. Its sales budget for the second quarter is given below: April May June Total Budgeted sales (all on account) $ 370,000 $570,000 $180,000 $ 1,120,000 The company estimates 25% of a month's sales are collected in the month of sale, another 65% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. February sales totaled $300,000, and March sales totaled $330,000. Required: Prepare a schedule of expected cash collections from sales, by month and in total, for the second quarter. What is the accounts receivable balance on June 30th?
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