Feeney Furniture prepared the following sales budget: Month Cash Sales Credit Sales March $19,000 $11,000 April $40,000 $11,000 May $43,000 $35,000 June $59,000 $50,000 Credit collections are 5% two months following the sale, 30% in the month following the sale, and 62% in the month of sale. The remaining 3% is expected to be uncollectible. What are the total cash collections in June at Feeney Furniture?

A. $101,050

B. $42,050

C. $19,820

D. $109,000

total cash collections in June = $101050

so correct option is A. $101,050

Explanation:

given data

month cash sales credit sale

march $19,000 $11,000

April $40,000 $11,000

May $43,000 $35,000

June $59,000 $50,000

to find out

total cash collections in June at Feeney Furniture

solution

we find here total cash collections in June that is express as

total cash collections in June = cash sale in June + (credit sale in June * 62%) + (credit sale in May * 30%) + (credit sale in April * 5%) ... 1

put here value we get

total cash collections in June = $59000 + ($50000 * 62%) + ($35000 * 30%) + ($11000 * 5%)

total cash collections in June = $101050

so correct option is A. $101,050