BAO 1101 Study Guide - Quiz Guide: Informa, Income Statement, Accounts Receivable

Schedule of Cash Collections of Accounts Receivable

Pet Stop Inc., a pet wholesale supplier, was organized on May 1. Projected sales for each of the first three months of operations are as follows:

All sales are on account. Of sales on account, 53% are expected to be collected in the month of the sale, 43% in the first month following the sale, and the remainder in the second month following the sale.

Prepare a schedule indicating cash collections from sales for May, June, and July.

Shown below are the expected sales for ABC Company:

Sales for Cash Sales on Account

January $15,000 $100,000

February $24,000 $120,000

March $18,000 $ 90,000

April $14,000 $ 70,000

On average, 50% of the sales on account are collected in themonth of sale, 30% are collected in the month following sale, andthe remainder is collected two months after the month of sale.

Calculate ABC Company's budgeted accounts receivable atApril 30. Do not use decimals in your answer.

Schedule of Cash Collections of Accounts Receivable

Pet Stop Inc., a pet wholesale supplier, was organized on May 1.Projected sales for each of the first three months of operationsare as follows:

All sales are on account. Of sales on account, 51% are expectedto be collected in the month of the sale, 44% in the first monthfollowing the sale, and the remainder in the second month followingthe sale.

Prepare a schedule indicating cash collections from sales forMay, June, and July.