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23 January, 12:30

Woodpecker Co. has $299,000 in accounts receivable on January 1. Budgeted sales for January are $939,000 Woodpecker Co. expects to sell 20% of its merchandise for cash. Of the remaining 80% of sales on account, 75% are expected to be collected in the month of sale and the remainder the following month. The January cash collections from sales are Oa, $840,160 b. $1,349,200 OC. $630,120 d. $1,050,200

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  1. 23 January, 12:48
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    D. $1,050,200

    Explanation:

    The January cash collections from sales are

    Total Budgeted sales for January are $939,000

    Cash sales = $939,000 x 0.20 = $187,800

    Cash from customers for January sales = $939,000 x 0.80 x 0.75 = $563,400

    Cash from december sales = $299,000

    Total January cash collections from sales are = $187,800 + $563,400 + $299,000 = $1,050,200
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