Question

Exercise 20-18 Budgeted cash receipts LO P2 Jasper Company has sales on account and for cash. Specifically, 70% of its sales are on account and 30% are for cash. Credit sales are collected in full in the month following the sale. The company forecasts sales of $525,000 for April, $535,000 for May, and $560,000 for June. The beginning balance of Accounts Receivable is $400,000 on April 1. Prepare a schedule of budgeted cash receipts for April, May, and June.

Answer 1

$1,756,600.

Step-by-step explanation:

P2 Jasper Company

Budgeted cash Receipt

For the 2nd quarter

April May June

Accounts Receivable $400,000

70% in the month of Sale $367,500 $374,500 $392,000

30% in the month after Sale $110,250 $112,350

Budgeted cash receipt $767,500 $484,750 $504,350

Total budgeted cash receipt for the 2nd quarter = $767,500 + $484,750 + $504,350 = $1,756,600.

30% in the month after sale means 30% amount will be received in the following month.