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17 March, 00:31

A merchandising company's sales budget indicates the following sales: January: $30,000; February: $20,000; March: $15,000. The company expects 80% of the sales to be on account. Credit sales are collected 30% in the month of the sale and 70% in the month following the sale.

The total cash receipts collected during March will be $___.

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  1. 17 March, 00:32
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    Total Cash receipts collected during March will be $17,800

    Explanation:

    Collection in March from:

    March Cash Sales [15000 x 20%] $3,000

    February Credit sale [$ 20000 x 80% x 70%] $11,200

    March Credit sale [$ 15000 x 80% x 30%] $3,600

    Total Cash receipts collected during March $17,800
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