Question

Sunland Company has the following budgeted sales: January $170000, February $220000, and March $180000. 40% of the sales are for cash and 60% are on credit. For the credit sales, 50% are collected in the month of sale, and 50% the next month. The total expected cash receipts during March are:

Answer 1

$192,000

Step-by-step explanation:

Cash expected from February credit sales = $220,000 *60% * 50% = $66,000

March cash sales = 40% * $180,000 = $72,000

Cash expected from March credit sales = $1800,000 * 60% * 50% = $54,000

The total expected cash receipts during March = $66,000 + $72,000 + $54,000 = $192,000