Final answer:
The budgeted cash receipts for June include June's cash sales and the credit sales from May that are paid in June, totaling $302,700.
Step-by-step explanation:
To calculate the budgeted cash receipts for June at Zhang Industries, we need to consider the sales growth, the cash and credit sales proportions, and the time at which these sales are expected to be received in cash form. Let's break down the calculation step by step:
- Calculate the expected sales for June, factoring in the 3% growth from May's 400 units at $750 each.
- Determine the amount of sales for cash and credit based on the 30% cash and 70% credit split.
- Since credit sales are paid in the month following the sale, for June's cash receipts, we only include May's credit sales.
- Finally, add up the cash sales for June and the receipt of credit sales from May.
For May, we have 400 units sold at $750 each, totaling $300,000 in sales. With the 3% growth for June, the sales would be 400 units × 1.03 × $750 = $309,000. Of this amount, 30% is paid in cash, equating to $309,000 × 0.3 = $92,700 in cash sales for June.
Credit sales from May that will be received in June are the remaining 70%, which is $300,000 × 0.7 = $210,000.
The budgeted cash receipts for June would, therefore, be the sum of June's cash sales and May's credit sales received in June: $92,700 + $210,000 = $302,700.