Question

Crocetti Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Budgeted selling price per unit $ 121 Budgeted unit sales (all on credit): January 7,000 February 7,500 March 11,900 April 14,900 Credit sales are collected: 40% in the month of the sale 60% in the following month The budgeted accounts receivable balance at the end of February is closest to:

Answer 1

The budgeted accounts receivable balance at the end of February is closest to: $4,500.

Step-by-step explanation:

Prepare a Accounts Receivable Budget for January and February

January February

Balance b/d $0 $4,200

Credit Sales $7,000 $7,500

Cash Received (40%) ($2,800) ($3,000)

Cash Received (60%) $0 ($4,200)

Balance c/d $4,200 $4,500

Conclusion:

Therefore, the budgeted accounts receivable balance at the end of February is closest to: $4,500