Meredith Company has budgeted sales for the upcoming months as follows: 40% of t

Question

Meredith Company has budgeted sales for the upcoming months as follows:

40% of the sales are credit sales, the remainder are made in cash. Credit sales are collected 50% in the month of sale, 35% in the month following the sale, and 8% in the second month following the sale.

April $ 455,000 May $ 467,000 June $ 490,000 July $ 524,000 August $ 502,000 September $ 482,000 Meredith Company has budgeted sales for the upcoming months as follows: April May June July August September 482,000 S 455,000 S 467,000 S 490,000 S 524,000 S 502,000 40% o the sales are credit sales, the remainder are made in cash. Credit sales are colected 50% in the month of sale 5 n e month fol in the sale and B in the second month. following the sale. a. Compute Meredith Company's cash receipts for June. (Do not round intermediate calculations.) Cash Receipts b. Compute Meredith Company's cash receipts for July. (Do not round intermediate calculations.) h Receipts c. Compute Meredith Company's cash receipts for August. (Do not round intermediate calculations.) Cash Receipts

Explanation / Answer

a Cash Receipts in June June Cash Sales 294000 =490000*60% June Credit Sales 98000 =490000*40%*50% May Credit Sales 65380 =467000*40%*35% April Credit Sales 14560 =455000*40%*8% Total collection 471940 b Cash Receipts in July July Cash Sales 314400 =524000*60% July Credit Sales 104800 =524000*40%*50% June Credit Sales 68600 =490000*40%*35% May Credit Sales 14944 =467000*40%*8% Total collection 502744 c Cash Receipts in August August Cash Sales 301200 =502000*60% August Credit Sales 100400 =502000*40%*50% July Credit Sales 73360 =524000*40%*35% June Credit Sales 15680 =490000*40%*8% Total collection 490640

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