Question

Ruiz Co.'s budget includes the following credit sales for the current year: September, $145,000; October, $136,000; November, $120,000; December, $157,000. Credit sales are collected as follows: 15% in the month of sale, 50% in the first month after sale, and 35% in the second month after sale. How much cash can the company expect to collect in December as a result of current and past credit sales

Answer 1

The total collection in December is "131150".

Step-by-step explanation:

The given values are:

Credit sales,

• September: $145,000
• October: $136,000
• November: $120,000
• December: $157,000

Now,

Credit sales in December will be:

=
`157,000* 15 \ percent`

=
`157000* 0.15`

=
`23550`

Credit sales in November will be:

=
`120000* 50 \ percent`

=
`120000* 0.5`

=
`600000`

Credit sales in October will be:

=
`136000* 35 \ percent`

=
`136000* 0.35`

=
`47600`

hence,

The total collection will be:

=
`23550+60000+47600`

=
`131150`