Question

Mapleview Inc.has the following budgeted sales:

July $200,000

August $300,000

Sept $250,000

40% of the sales are for cash. 60% are on credit. For the credit sales, 50% are collected in the month of sale, and 50% for the next month. The total expected cash receipts during September are:

A) $265,000
B) $262,500
C) $250,000
D) $280,000

Answer 1

Answer: A) $265,000

Explanation: budgeted sales:

July $200,000 -

Cash sales = 200,000 x 40% = 80,000

Credit sales = 200,000 x 60%= 120,000 . 60,000 collected in July, 60,000 collected in August.

August $300,000 -

Cash sales = 300,000 x 40% = 120,000

Credit sales = 300,000 x 60%= 180,000 . 90,000 collected in August, 90,000 collected in September

Sept $250,000-

Cash sales = 250,000 x 40% = 100,000

Credit sales = 250,000 x 60%= 150,000 . 75,000 collected in September 75,000 collected in October

Total collected in the month of September is $100,000+$90,000+$75,000= $265,000