Please explain how to calculate “collection of accounts receivable” for the mont
ID: 2521072 • Letter: P
Question
Please explain how to calculate “collection of accounts receivable” for the month of May and June. I know that of May is $400,000. Jasper Company has sales on account and for cash. Specifically, 70% of its sales are on account and 30% are for cash. Credit sales are collected in full in the month following the sale. The company forecasts sales Or $560,000 for June. The beginning balance of accounts receivable is $400,000 on April 1. Prepare a schedule of budgeted cash receipts for April, May, and June.Explanation / Answer
SCHEDULE OF THE CASH RECEIPT FOR THE MONTH OF APRIL, MAY AND JUNE PARTICULARS March APRIL MAY JUNE Sales $ - $ 5,25,000 $ 5,35,000 $ 5,60,000 Receivable $ 4,00,000 Cash Sales 30% (A) $ - $ 1,57,500 $ 1,60,500 $ 1,68,000 Net Amount receivalbe from credit sales $ 4,00,000 $ 3,67,500 $ 3,74,500 $ 3,92,000 Credit sales are collected in full in the following month of sales means for tmarch we received in april , For april we receive in may and for may credit sales in June (B) $ 4,00,000 $ 3,67,500 $ 3,74,500 Total Cash Receipts (A + B) $ 5,57,500 $ 5,28,000 $ 5,42,500