Quattro began operations in April of this year. It makes all sales on account, s
ID: 2521242 • Letter: Q
Question
Quattro began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 20% are collected in the month of sale; 50% are collected in the first month after sale; and 30% are collected in the second month after sale. If sales for April, May, and June were $53,000, $73,000, and $63,000, respectively, what were the firm's budgeted collections for April?
$10,600.
$12,600.
$41,100.
$42,400.
Some other amount.
Quattro began operations in April of this year. It makes all sales on account, subject to the following collection pattern: 25% are collected in the month of sale; 55% are collected in the first month after sale; and 20% are collected in the second month after sale. If sales for April, May, and June were $67,000, $87,000, and $77,000, respectively, what were the firm's budgeted collections for June?
$19,250.
$58,600.
$67,100.
$80,500.
Some other amount.
Explanation / Answer
The budgeted collections for April = $ 53,000 * 20%
= $ 10,600
Hence the correct answer is $10,600
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The correct answer is $ 80,500
Note :
Budgeted Cash Receipts April May June Credit Sales 67,000 87,000 77,000 25% in Month of Sale 16,750 21,750 19,250 55%in First Month after Sale - 36,850 47,850 20% in Second Month after Sale - 13,400 Total Sales Receipts 16,750 58,600 80,500