A company is formulating its plans for the coming year, including the preparation of its cash budget. Historically, the company's sales are 30% cash. The remaining sales are on credit with the following collection pattern: Collections on Account Percentage In the month of sale 40%
In the month following the sale 58%
Uncollectible 2%
Sales for the first 5 months of the coming year are forecast as follows:
January $3,500,000
February 3,800,000
March 3,600,000
April 4,000,000
May 4,200,000
For the month of April, the total cash receipts from sales and collections on account would be
a. $3,729,968
b. $3,781,600
c. $4,025,200
d. $4,408,000
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