Question

The BRS Corporation makes collections on sales according to the following schedule:

1. 30% in the month of sale.
2. 66% in the month following sale.
3. 4% in the second month following sale.
The following sales have been budgeted:
Sales
April $130,000
May $150,000
June $140,000
Budgeted cash collections in June would be:
A. $146,200
B. $140,000
C. $140,520
D. $141,000
Cash Budget:
Cash budget is a part of the master budget prepared by a company on a periodic basis. The cash budget is prepared with the help of data available on cash receipt and cash reimbursement.

Answer 1

To calculate the budgeted cash collections in June, we need to calculate the cash collections for each month of sale and add them together. The budgeted cash collections in June would be $143,600.

Step-by-step explanation:

To calculate the budgeted cash collections in June, we need to calculate the cash collections for each month of sale and add them together.

For April sales: 30% of $130,000 = $39,000

For May sales: 66% of $150,000 = $99,000

For June sales: 4% of $140,000 = $5,600

Adding these amounts together: $39,000 + $99,000 + $5,600 = $143,600

Therefore, the budgeted cash collections in June would be $143,600.