Kuzma Foods, Inc. has budgeted sales for June and July at $ 670 comma 000 and $ 740 comma 000 , respectively. Sales are 90 % credit, of which 60 % is collected in the month of sale and 40 % is collected in the following month. What is the budgeted Accounts Receivable balance on July 31?

Question

Ibrahim Page

Business

10 November, 15:47

Kuzma Foods, Inc. has budgeted sales for June and July at $ 670 comma 000 and $ 740 comma 000 , respectively. Sales are 90 % credit, of which 60 % is collected in the month of sale and 40 % is collected in the following month. What is the budgeted Accounts Receivable balance on July 31?

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Answers (1)

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Anya Pruitt · Answer 1

Account receivable = $266,400

Explanation:

Giving the following information:

Sales:

June = $670,000

July = $740,000

Sales are 90 % credit, of which 60 % is collected in the month of sale and 40 % is collected in the following month.

On July 31, sales on account from June are technically collected. Sales on account pertain to July.

Account receivable:

From July = (740,000*0.9) * 0.4 = $266,400