Mitchell Company had the following budgeted sales for the last half of last year

Question

Mitchell Company had the following budgeted sales for the last half of last year: Cash Sales July $60,000 August $65,000 September $49,000 October $54,000 Thursday $64,000 Friday $90,000 Credit Sales July $160,000 August $180,000 September $140,000 October $149,000 Thursday $210,000 Friday $390,000 The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled: Collections on credit sales 50% in month of sales 45% in month of following sales 5% in second month following sales What is the budgeted accounts receivable balance on December 1? A) $141,300 B) $146,000 C) $105,000 D) $112,450

Explanation / Answer

Hi, Please find the answer as follows: = 210000*.50 + .05*149000 = 112450 Thanks.

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